Should Bank Executives Face Stricter Accountability Rules?

Official title: Consultative document on Senior Leader Accountability

Open Regulations & Permits Finance & Consumer
Canada's financial regulator wants to tighten the rules for who can lead banks, insurance companies, and other financial institutions. Right now, there are basic requirements for executives and board members. OSFI is proposing a new framework that would require clearer job responsibilities, regular fitness checks, and consequences when things go wrong.

Why This Matters

Remember when banks failed during the 2008 crisis? Or more recent scandals where executives walked away while customers suffered? This consultation is about making sure the people running your bank or insurance company are actually qualified—and can be held responsible when they mess up. Your savings, mortgage, and insurance depend on these institutions being well-managed.

What Could Change

Financial institutions would need to create detailed "accountability frameworks" mapping out who's responsible for what. Executives would have to regularly attest they're fit for their roles. Boards would submit annual reports to OSFI confirming their leaders meet standards. Some of this information might become public. When things go wrong, it would be clearer who's accountable.

Key Issues

  • What governance practices do institutions currently use to ensure their leaders are suitable and accountable?
  • Will the proposed accountability framework actually improve leadership standards and public confidence?
  • Is the definition of 'senior leaders' too broad or too narrow?

How to Participate

  1. Review the consultative document and the backgrounder to understand the proposed accountability framework.
  2. Submit your feedback by email to pds-epn@osfi-bsif.gc.ca by the deadline.

Submit Your Input

Draft Email
Questions Being Asked (3)
  1. What are the current governance practices of institutions regarding the suitability and accountability of senior leaders? How is the effectiveness of these practices measured?
  2. What are your reactions to OSFI's proposal? Will the proposed guidance enhance leadership suitability standards, governance, and public confidence?
  3. Are there any alternatives to our proposal, or specific elements you think we should include, prioritize, or omit in our guidance? For example, is the scope of our definition of 'senior leaders' adequate? Is there a need to expand or reduce it?

Key Documents