Earlier this fall, the International Organization of Securities Commissions (IOSCO) Committee on Retail Investors (also known as Committee 8, or C8) published its final Sound Practices for Investment Risk Education Report, which examines the role that securities regulators play in investment risk education and the challenges that they face. The report outlines and analyzes the various different practices that IOSCO members have adopted while designing and delivering their investment risk education initiatives, and includes a review of the various literature available on the topic.
The IOSCO Committee on Retail Investors was formed in June 2013 to conduct IOSCO’s policy work on investor education and financial literacy and also advise the IOSCO Board on emerging retail investor protection matters. OSC staff led the development of the committee’s strategic framework that sets out IOSCO’s role in investor education and financial literacy, a strategy for program development and proposed work streams. The Committee’s work includes developing innovative approaches to investor education and financial literacy programming, and providing opportunities for cooperative approaches among jurisdictions.
Investor Office Director Tyler Fleming is the OSC’s lead for IOSCO C8. He recently participated in a panel that included regulators from Québec, Australia and the United Kingdom, which reviewed the Sound Practices for Investor Risk Education for an international audience. The panel looked at a number of sound practices, including:
- focusing on influencing retail investor attitudes and behaviour, as well as knowledge;
- developing initiatives that take an evidence-based approach in response to the needs of retail investors;
- testing initiatives with the target audience;
- developing initiatives that reach people close in time to the making of investment decisions and that are promoted in a variety of ways to expand reach and interaction;
- sending clear messages that are adapted for different target groups (e.g. beginner and more savvy investors) and for the different ways people access information;
- using engaging content and delivery styles;
- designing activities that are current and up to date with emerging new technologies and developments in financial markets;
- developing investor education initiatives that complement regulatory actions to enhance impact; and
- developing evaluation frameworks and measures at the outset and seek to evaluate outputs and outcomes.
The full Sound Practices for Investment Risk Education report, as well as many others, can be found on IOSCO’s website.