News & Events

News Release

Ontario Securities

20 Queen St. W.
Box 55, Suite 1900
Toronto, ON M5H 3S8
Commission des valeurs mobilières de l'Ontario

March 20, 2012

OSC Report Outlines Concerns Related to Emerging Markets Issuers

TORONTO – The Ontario Securities Commission (OSC) today published a Staff Notice that summarizes its review of emerging market issuers and outlines principal sources of concern relating to issuer disclosure, underwriter conduct, the role of auditors and the exchange listing process.

The review was initiated by the OSC in July 2011, in response to concerns that investors in emerging market issuers may be exposed to inappropriate risks. OSC staff examined a targeted selection of 24 Ontario reporting issuers listed on Canadian exchanges with significant business operations in emerging markets. Staff focused on the adequacy of issuer disclosure and corporate governance practices, as well as the important roles played by auditors, underwriters and exchanges in bringing these issuers to market.

The report outlines the main areas where improvement is required and where the OSC expects to see concerted action taken by issuers, underwriters, auditors and exchanges in order to protect investors and uphold the integrity of public disclosure. Specifically, the OSC will examine ways to, among other things:

  • improve corporate governance practices of boards of emerging market issuers;
  • develop transparent and consistent due diligence requirements for underwriters;
  • improve the access to working paper files and quality of audit practices, particularly when foreign auditors are involved;
  • enhance disclosure of risk factors and complex corporate structures relevant to emerging market issuers; and
  • work with the exchanges to enhance the listing process to address the unique concerns raised by emerging market issuers.

“The OSC expects issuers and gatekeepers to act in a manner that promotes investor protection and supports confidence in our capital markets,” said Howard Wetston, Q.C., Chair and CEO of the Ontario Securities Commission. “This review uncovered a number of areas where issuers and gatekeepers need to improve in order to meet their obligations and we will be monitoring their progress to ensure the interests of investors are placed first.”

As a next step, OSC staff will assess the areas that require further policy examination. Staff will follow up with individual issuers, underwriters and auditors as appropriate and will refer matters to enforcement as warranted. Additionally, the OSC will engage domestic and international partners in order to ensure effective regulatory coordination.


For Media Inquiries:     Carolyn Shaw-Rimmington
Manager, Public Affairs

Dylan Rae
Media Relations Specialist

For Investor Inquiries:     OSC Contact Centre
1-877-785-1555 (Toll Free)