The Securities and Exchange Commission has published a draft strategic plan that lays out its top strategic goals in coming years. The Commission is seeking public comment prior to finalizing the plan, which details priorities through Fiscal Year 2022.
Priorities detailed in the plan include: serving the long-term interests of Main Street investors; becoming more innovative, responsive, and resilient to market developments and trends; and leveraging staff expertise, data, and analytics to bolster performance.
The plan was prepared in accordance with the Government Performance and Results Modernization Act of 2010, which requires federal agencies to outline their missions, planned initiatives, and strategic goals for a four-year period.
“The plan provides a forward-looking framework for making the SEC even more effective, focusing on the most important goals and initiatives that will best position the SEC to fulfill our mission,” SEC Chairman Jay Clayton said. “These goals and initiatives span our five divisions and 25 offices.”
A top priority, the report says, is expanding the Commission’s focus on “the long-term interests of our Main Street investors.”
“Investors have long looked to the securities markets to grow their hard-earned savings to fund important life events, including buying a new home, paying for college, and funding retirement,” it says. “Also, significant numbers of Americans are nearing retirement age and living longer in retirement. This has put increased importance on the investment products that retirees rely on for stable income.”
Other areas have also experienced substantial evolution. “When Main Street investors seek professional advice, their choices all too often are not as clear as they should be,” the plan says. “The distinction between investment professionals who sell securities and those who provide investment advice has become less clear. This lack of clarity makes it challenging for investors to understand what standards of conduct govern the investment professionals who assist them.”
“As a backdrop to all this, the number of companies raising capital through the public securities markets has declined, and those that are joining our public disclosure and offering regime are doing so later in their lifecycle.”
“This dynamic has reduced the number of opportunities our Main Street investors have to invest in companies, including those in the emerging and growth sectors of our economy,” the report says.
Among the initiatives the SEC will pursue in the coming years:
better understanding the channels retail and institutional investors use to access capital markets to more effectively tailor policy initiatives;
deploying the agency’s resources to address new or emerging risks to investors;
pursuing enforcement and examination initiatives focused on addressing misconduct that impacts retail investors;
expand efforts in various areas, including securities custody and penny stock trading;
modernizing the design, delivery, and content of disclosure so investors, in particular retail investors, can access readable, useful, and timely information;
reexamining business and accounting disclosure requirements
modernizing EDGAR, the SEC’s information technology system;
identifying ways to increase the number and range of long-term, cost-effective investment options available to retail investors, including by expanding the number of companies that are SEC-registered and exchange-listed;
expanding the Commission’s focus, expertise, and scope of operations in such areas such as market monitoring analysis, market operations, (including clearing and settlement, and electronic trading) across equity, fixed-income, and other markets; and
identifying and address, existing SEC rules and approaches that are outdated.
The SEC will also focus on ensuring that regulated market participants are actively and effectively engaged in managing cyber-security risks and appropriately informing investors and other market participants of these risks and incidents. The plan also calls for elevating the SEC’s performance by enhancing analytical capabilities and staff development.
Additional goals include:
expanding the use of risk and data analytics to set regulatory priorities and focus staff resources, including developing a data management program that treats data as an SEC-wide resource with appropriate data protections, enabling rigorous analysis at reduced cost;
investing in needed data streams, new technological tools, and improving enterprise data management practices and infrastructure;
enhancing analytics of market and industry data to prevent, detect, and prosecute improper behavior.
enhancing the agency’s internal control and risk management capabilities; and
developing a robust and resilient program for dealing with threats to the security, integrity, and availability of the SEC’s systems and sensitive data.
To expedite these goals, the SEC recently hired a new chief risk officer to lead and coordinate the agency’s various risk management efforts.
To comment on the 2018-2022 Draft Strategic Plan, send an e-mail to PerformancePlanning@sec.gov.