FINRA Moves to Boost Transparency & Communication with Member Firms

The Financial Industry Regulatory Authority (FINRA) has revealed several changes to its advisory committees. These changes are designed to increase transparency around the committees and improve their effectiveness as a vehicle for firms to provide input on key issues before FINRA. The move is part of the FINRA360 review process – a program created by the relatively new FINRA CEO Robert Cook. FINRA expects to announce additional changes following its December Board of Governors meeting.

The new steps FINRA has announced include:

  • broadening the authority and membership of the Operations Advisory Committee to include providing input on operational and technology implications of rule changes;
  • publishing rosters of each advisory committee on FINRA.org;
  • providing additional detail in FINRA rule filings and Regulatory Notices about the committees that reviewed the proposals;
  • issuing an annual notice about the committees and the application process to become a committee member.

FINRA said it is currently conducting a holistic review of its advisory and district committees. In early 2018, FINRA said it would introduce an online portal to enable registered representatives to begin the process of serving on committees. These moves should help provide a better voice from the firms FINRA regulates.

FINRA has 16 advisory committees that provide feedback on rule proposals, regulatory initiatives and industry issues. More than 160 industry members and 35 non-industry members serve on these committees. The advisory committees meet in-person or via teleconference typically between two and five times a year.

Marcia Asquith, FINRA Executive Vice President, Board and External Relations, commented on the announcements;

“These changes are an important part of improving FINRA’s engagement with firms and representatives. Meaningful conversation with member firms to leverage their expertise and hear their perspective on critical issues is a key part of any successful self-regulatory organization.”

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