FINRA Announces Enhancements to Advisory Committees to Increase Transparency, Improve Effectiveness

Changes Are Part of Ongoing FINRA360 Initiative

WASHINGTON — The Financial Industry Regulatory Authority (FINRA) today announced several changes to its advisory committees to increase transparency around the committees and improve their effectiveness as a vehicle for firms to provide input on key issues before FINRA, including on existing and proposed rules.

The changes—the first phase of a series of FINRA Board of Governors transparency initiatives—are part of the FINRA360 organizational improvement initiative and address feedback FINRA received in response to a Special Notice on its engagement programs issued in March. FINRA expects to announce additional changes following its December Board of Governors meeting.  

Steps FINRA is taking 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; and
• issuing an annual notice about the committees and the application process to become a committee member.

Further, in early 2018, FINRA will introduce an online portal to enable registered representatives to begin the process of serving on committees. In addition, FINRA is conducting a holistic review of its advisory and district committees to determine if further changes are appropriate.

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.

“These changes are an important part of improving FINRA’s engagement with firms and representatives,” said Marcia Asquith, FINRA Executive Vice President, Board and External Relations. “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.”

In early September, FINRA developed a new web page that centralizes information on FINRA’s governance and corporate structure. Available at www.finra.org/governance, the page lists members of FINRA’s Board of Governors, a calendar of upcoming Board meetings, as well as governance documents and Board communications.  

FINRA is dedicated to investor protection and market integrity. It regulates one critical part of the securities industry – brokerage firms doing business with the public in the United States. FINRA, overseen by the SEC, writes rules, examines for and enforces compliance with FINRA rules and federal securities laws, registers broker-dealer personnel and offers them education and training, and informs the investing public. In addition, FINRA provides surveillance and other regulatory services for equities and options markets, as well as trade reporting and other industry utilities. FINRA also administers a dispute resolution forum for investors and brokerage firms and their registered employees. For more information, visit www.finra.org.