To widen the options available for businesses and investments, the Committee recommended introducing Limited Partnerships and Limited Liability Partnerships. To improve access to finance and lower the cost of raising capital, the Committee advocated allowing additional exempted offerings, such as private placement and small offering exemptions. The Committee also suggested removing statutory requirements for audit and appointment of professional company secretaries, so as to trim compliance costs for companies, especially small private companies and start-ups. Safeguards will be simultaneously introduced to uphold corporate governance standards and protect stakeholders’ interests. I am happy to announce that the government has accepted all the recommendations of this Committee. They will ensure that our company law is market-driven, supportive of entrepreneurship and aligned with international best practices. The Ministry of Finance will release further details. Finally, just as we are encouraging greater corporate disclosure, the government is also working towards raising levels of transparency through consultation and collaboration with the private sector. Consultation lengthens the policy-making process and entails commitment of effort and resources on the part of the industry and the public. But it also helps to pre-empt implementation problems, minimise unintended consequences, and foster better industry understanding and support. The Monetary Authority of Singapore (MAS) has introduced guidelines to make public consultation a standard procedure whenever significant changes in the financial services regulatory framework are planned. Over time, these changes will further improve the operating environment for the financial sector. The MAS will release further details.
To give these measures teeth, key elements of the Senior Managers Regime should be extended to all firms active in wholesale FICC markets, including dealers and asset managers. That means all senior managers would have clearly defined responsibilities and would be answerable for training, certifying and monitoring the material risk takers they supervise. The FCA should oversee compliance, redeploying resources to focus on Senior Persons. In turn, these individuals would be on the hook for promoting compliance within their organisations. Incentives will be aligned. For the best in the industry, this won’t be new. This is just how you run your business. But for others, who free ride on your reputations: the Age of Irresponsibility is over. Third, regulators should extend the coverage of market abuse regulation to include every major fixed income and currency market. And criminal sanctions should be updated, with market abuse rules similarly extended and maximum prison terms lengthened. Finally we need global standards for global markets. I welcome the FICC Markets Standards Board’s intent to be as global as possible in its membership and influence. All major Central Banks and market participants have begun working on developing a new single Global Code for FX. I would encourage IOSCO to consider complementing these efforts with a similar initiative to cover FICC markets as a whole when they meet in London next week. The FSB will engage with these processes and work to improve the alignment between remuneration and conduct risk across the globe.