Chief Executive of the Financial Markets Authority, the New Zealand government agency responsible for financial regulation.
What attracted you to the position at the Financial Markets Authority?
After working around the globe as a lawyer and banker, my wife (who’s from Dunedin) and I wanted to bring up our three kids in New Zealand. At the time, the chief executive role at the Financial Markets Authority (FMA) was being recruited for. I was really attracted to the position because I’d experienced both good and bad regulation from the other side of the table in my role at Merrill Lynch. This was an opportunity to be at the forefront of implementing a brand new regulatory regime here in New Zealand and putting to use some of what I’d learned.
What successes have you had since taking on the job?
Any successes are the FMA’s as a whole, not mine. And I’m incredibly proud of the passion and commitment shown by all our staff for our work.
We have encouraged an open-door policy from the start, and certainly a key success has been creating a dialogue between the FMA and the sectors we now regulate. Disagreement often arises, and occasionally some haven’t liked what we are doing. But we all have a clear willingness to sit down and talk about it. I believe that desire to engage is absolutely critical to creating a transparent financial market.
What challenges do you face in your role?
It’s a new regime, covering some sectors that have never been regulated before. Helping stakeholders understand how we intend to operate under our legislation is taking time. In some cases, we have to walk the walk of being a pragmatic and risk-based regulator, before people will believe the talk.
What is the FMA doing now that will have a significant effect on financial markets?
Licensing the key financial services providers is a given pretty much everywhere else in the world, but here in New Zealand it is new. Licensing gives us the entry point for an ongoing dialogue with different sectors of the industry. This will form the basis for the FMA strengthening its position as an effective and influential regulator.
How can investors best protect themselves from losing money?
Don’t take anything at face value. Check, ask, research before you invest – or get advice from someone who can do that for you. Is the entity or individual in question authorised or licensed, are they New Zealand-based? What do you know about them? Never hand over your money if you can’t answer those questions.
Once you’ve made an investment decision, continue to be interested in what your providers are doing with your money, and why.
Information about the various things to consider when investing is available on our website.
Are the New Zealand capital markets safer for individual investors these days?
People have long and painful memories of the equity market crash in the late 1980s and the more recent finance company collapses. Since then, much has changed and major parts of the financial services industry are now licensed and actively supervised by the FMA or the Reserve Bank.
This will never guarantee that markets won’t drop or that cheats and frauds won’t exist. But the FMA aims to help investors know where to look for information or advice, and what to ask. We want to reassure investors that the regulator is up to the task.