Players change but ‘bad boy’ behaviour same everywhere – Securities expert
While misconduct, errant traders and bad boy behaviour are similar in all capital markets, sharing of this cross border information will assist regulators to pin them down and deter them more effectively says a securities expert.
Sharing of experiences in their own countries will spur early detection and rectification of breaches of laws and shaping business and capital markets’ conduct along with effective deterrence, Ranjit Ajit Singh, Chairman, International Organisation of Securities Commissions’ (IOSCO) Growth and Emerging Markets Committee (GEM) and Chairman, Securities Commission Malaysia told the Business Times on the sidelines of the GEM Conference in Colombo on Wednesday.
“Players may change, but misconduct is similar in all markets,” he said noting that the more experiences they share, the more similarities they detect.
He said that in Sri Lanka’s case there’s no ‘overregulation’ and that a clear and well-developed legal framework gives the regulator the necessary powers to detect, investigate and sanction unlawful conduct. “It also fosters legal certainty, so that the financial sector and market participants, including the public, understand their rights, obligations and remedies,” he said. He said that both theoretical endeavours and policy construction would benefit from some corrective analysis. He commended SEC’s aim to take prompt action, including disrupting misconduct or requiring rectification of breaches of laws before any lapses escalate into more serious infringements.
This conference organised by the Securities and Exchange Commission (SEC) Sri Lanka saw participants discussing the impact of Fintech (Financial Technology) in capital markets. GEM Conference (GEMC) has the distinction of being the only committee established by an international standard setter with a specific focus on issues faced by emerging markets.
Mr. Singh said the GEMC Workshop on cyber resilience assisted by external experts, provided valuable guidance to strengthen their efforts on cyber security. It also explored how fintech firms are disrupting the entire capital markets’ value chain with new business models and innovative technologies for security issuance, trading, and operations.
Fintech disruption in the capital markets, according to some participants at GEMC, has emerged along different paths than other areas of financial services. This is true in areas such as lending and payments as it looks to remap legal systems pertaining to the relationships among the sell side, buy side, exchanges, and regulators.
Capital market firms, in observing the impact of fintech on banking and retail businesses, have taken a proactive and collaborative approach to engaging alternative fintech business models and disruptive technologies, a participant told the Business Times.
During the session on “Enhancing Sustainable and Innovative Market Based Financing”, participants discussed the development of sustainable market-based financing, ways to enhance liquidity in emerging markets, as well as the impact of innovation and technology on regulation.
At the IOSCO opening ceremony, Chief Guest Prime Minister Ranil Wickremesinghe said a new monetary law will enable the Central Bank to focus on the essential items and not be involved in peripheral activity. “We have the liability management law and we are already working on creating a national debt office in the Ministry of Finance. We are already working on two laws, one for the Securities and Exchange Commission (SEC) and another on the demutualisation of the stock exchange, which have been approved by Cabinet,” he said addressing the crowd noting that these are in the draft process and the government is also coming through on a programme to encourage the ease of doing business. “A new law may be necessary on how we deepen it.”
He added that a taskforce on investment, legislation on the single window clearance committee is also ready and being drafted. “With this we are looking at exports and our competitiveness, our services, tourism and logistics sectors.”