OSC’s Investor Advisory Panel 2025 Annual Report

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2025 Annual Report of the
Ontario Securities Commission’s
Investor Advisory Panel
May 2026

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Introduction
The Investor Advisory Panel (IAP, or the Panel) is pleased to present our 2025 Annual Report outlining our activities, submissions, consultations, and meetings during the calendar year. Since its formation in 2010, the IAP has served as the advisory committee to the Ontario Securities Commission (OSC) that provides the primary retail investor perspective on the OSC’s policy and rule-making initiatives. We have worked closely with the OSC’s Investor Office and with other OSC staff to address existing and emerging areas of concern and risk for retail investors, actively participating in the policymaking process – from issue identification to policy development to commenting on new rules and processes once they have been drafted and proposed for implementation. Retail investor input is key to ensuring a healthy and fair regulatory regime. The IAP’s mission is to provide that input, and act as a useful policymaking resource for the OSC in its development and administration of rules that protect investors, promote fair, efficient and competitive capital markets and confidence in the capital markets, and reduce systemic risk.

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How the Investor Advisory
Panel Works
The IAP provides advice to the OSC at all three stages of the policy development process:
Stage 1
Issue Identification
We bring an investor perspective to the OSC to inform policymaking at the earliest stages by identifying and raising areas of interest or concern through face-to-face meetings with key staff. When appropriate, we follow up with specific recommendations. Stage 2 Policy Development We provide the OSC with an investor viewpoint, including identifying important matters and concerns on regulatory policy development. Throughout ongoing discussions with OSC staff and other key stakeholders, we engage in constructive and thoughtful dialogue regarding investor issues, and we propose relevant recommendations to help address such issues. We strive to ensure our recommendations are evidence-based. Stage 3 Policy Proposals and Discussion Papers We regularly provide advice on policy proposals once they have been published for comment to ensure the investor voice is considered in final outcomes. The IAP advises the OSC on policymaking through an investor lens.

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How the IAP Engages with the OSC
Identify Issues
Act as a Resource and
Provide Advice During
Policy Development
Comment on Draft
Initiatives
Key numbers for 2025
11
Panel Meetings
11
Submissions, letters and reports to the OSC/CSA 5 Submissions to other bodies 5 Meetings with external organizations

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2025 in Review
The IAP fulfills its mandate by advising the Commission on investor issues and recommending the consideration of investors’ interests in the Commission’s policy and rule-making. Throughout 2025, the Panel highlighted issues, engaged in discussions, and submitted comments on matters pursued by the Commission in furtherance of the four elements of its mandate:
a. to provide protection to investors from unfair, improper or fraudulent practices; b. to foster fair, efficient and competitive capital markets and confidence in capital markets;
c. to foster capital formation; and
d. to contribute to the stability of the financial system and the reduction of systemic risk. The IAP seeks to advise the Commission on investors’ interests so that they may be considered in the Commission’s work across each of these four areas. While the four elements of the OSC’s mandate address different aspects of securities regulation, investor protection is essential for each to be realized. Accordingly, throughout the year, we raised issues and made recommendations across a variety of initiatives that address each prong of the OSC’s mandate. 2025 continued the ongoing trend of significant changes that affect investors, including advances in technology, more variety in investment products and ways to invest, and increasing uncertainty concerning the economy and the broader geopolitical environment. Much of the IAP’s work throughout the year was focused on these issues and their impact on retail investors in the context of securities regulation, including the OSC’s contribution to promoting financial stability, assessing investor challenges and opportunities, approaches to enforcement, investor redress, alternative investment products, and the continued rise of DIY investing and related issues. This report highlights the work of Panel in identifying issues and recommendations in the following areas:

1. Investors: disclosure and information, responding to wrongdoing, and redress
2. Capital Markets: effective regulation, capital formation, and competition
3. Engagement: domestic and international matters

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2025 Highlights
Investors
IAP Observations:

• Increasingly complex
  environment and more risks
• Legal and regulatory framework is
  fragmented
• Investors need fair and effective
  dispute resolution processes
  IAP Recommendations:
• Expand tools and resources
  for investors with appropriate safeguards
• Expand enforcement tools and
  strategies and enhance partnerships
• Implement binding authority for OBSI
  Capital Markets
  IAP Observations:
• Need for right-sized regulation that
  responds to new developments
• Regulatory environment should be
  supportive of innovation and growth while protecting investors
• Investors should have a choice of
  investments supported by quality service
  IAP Recommendations:
• Safeguards will be critical to maintain
  investor protection
• Capital formation initiatives should
  include consideration of the impact on investors and should recognize that investor protection mechanisms can support effective capital formation
• Enhanced competitiveness requires
  balance; regulatory guidance should support markets and investors Engagement
• Collaboration and harmonization
  within Canada enhances investor protection
• The international geopolitical
  environment is a source of uncertainty and concern
• The OSC collaborates with
  international working groups on various issues, and monitors international developments IAP Observations: IAP Recommendations:
• Regulators should continue to
  collaborate and promote consistency
• Continue to carefully consider
  international developments and potential impacts on investors, including support for investors and the need to uphold the rule of law
• Continue to play a leadership role
  at IOSCO and participate with other international working groups; these are an important element of protecting investors and upholding the rule of law

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Investors
The first element of the OSC’s mandate is to provide protection to investors from unfair, improper or fraudulent practices. In 2025, the Panel’s work in this area focused on: (1) providing information to investors, both through timely, accurate and efficient disclosure of investment information, and initiatives by the regulators to enhance investor awareness and education, (2) enforcement, and (3) providing redress to harmed investors.

• Investors face an increasingly complex
  environment and more risks
• DIY investing and the use of social media as a
  source of information are on the rise
• Investors need accurate information that is
  clear and easy to understand, as well as tools and other supports that promote informed decision-making
• Frauds and scams are more frequent and
  sophisticated
• Canada’s framework for combatting fraud is
  fragmented and disjointed
• Investors need fair and effective dispute
  resolution processes
  The IAP recommends:
• Allowing for and considering additional tools and resources to support investors, together with
  appropriate safeguards
• Consideration of whether additional measures are needed for investor protection, including
  with respect to digital engagement practices and finfluencers
• Investor disclosure that is accessible, clear, and easy to understand
• Expanding the tools and strategies available for enforcement
• Enhancing partnerships to more effectively prosecute securities fraud
• Finalizing and implementing binding decision-making authority for OBSI

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Investor Awareness and Education
Investor education and understanding are crucial components of investor protection and are increasingly important given the rise of DIY investing and social media. THE PANEL’S OBSERVATIONS:
DIY investing remains a popular choice for Canadian investors. As the number of DIY investors continues to rise, so too do the risks facing these investors, including sources of potentially inaccurate information, gamification of investing, and new types of frauds and scams. Moreover, retail investors increasingly operate in a marketplace where both investment decisions and the choice of how to invest may be influenced as much by “nudges” and other design elements as they are by knowledge and information. Accordingly, issues relating to investor awareness and education, and investor protection, are multi-faceted. Retail investors have more sources of information about investing than ever before, including regulators, investment advisors, artificial intelligence (AI) tools such as ChatGPT, social media, and a range of online resources ranging from news publications to sponsored content. The capital markets are also becoming more complex, with new investment products and ways to invest. Against this backdrop, there is a critical need for accurate information and reliable sources, that present the information clearly. Accurate and reliable information should also be easy for retail investors to understand and act upon. Interactive tools that provide accurate, reliable information can help investors make informed investment decisions. Many retail investors use social media and AI for investment information and advice. Canadian investors are also susceptible to being defrauded by criminals deploying AI to generate deep fakes or other types of fraudulent schemes, as well as market manipulation such as pump and dumps. The OSC’s report on social media and retail investing reveals that the rise of social media has “transformed how retail investors engage with financial markets”, and that more investors are making investment decisions based on information found on social media. The DIY Investing Report published by the Canadian Investment Regulatory Organization (CIRO) indicates that DIY investors rely on platforms such as YouTube, Reddit and Instagram for education and information about investing. The CSA’s research on hybrid investors indicates that this group of investors show “higher levels of risk taking and speculative behaviour”. Similarly, the FCAC report on financial advice indicates that Canadians between the ages of 18 and 34 are more likely to turn to social media for financial advice. Digital engagement practices (DEPs), including gamification, are also an area of concern, as they can have a significant influence on investor decision-making. The OSC’s examination of DEPs indicates that firms are engaging in practices that can be harmful to investors, though not all DEPs increase risk. Common DEPs include push notifications and on-screen prompts, rewards programs, contests, hidden information, gaming-style programs and design features, and lists of top traded or trending assets. In October, the OSC provided further guidance for registrants who
use DEPs in their marketing or other client interactions.

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THE PANEL’S RECOMMENDATIONS:
In 2025, the Panel provided input on various initiatives related to investor education, knowledge and understanding. We supported CIRO’s work in revising guidance for order execution only (OEO) dealers, allowing for easier access to timely, accurate information and tools designed to support informed decision-making by DIY investors. In February, we provided recommendations for CIRO’s consideration in developing new guidance for OEO dealers, including supporting the use of self￾assessment and filtering tools, as well as educational information, and recommending caution with respect to the use of Generative Artificial Intelligence (Gen AI). In November, the Panel offered support for CIRO’s proposed new guidance, as well as additional safeguards for investors and clarity for OEO dealers. Our recommendations included making information available at the time of trading, ensuring that decision-making supports are free of conflicts, and adding safeguards with respect to the use of Gen AI. The Panel has previously recommended that measures be taken to reduce or restrict DEPs, including gamification. In 2025, we suggested that CIRO’s proposed new guidance for the OEO channel should more specifically address harmful DEPs. Our comments on the OSC’s draft statement of priorities in January 2026 reiterated the suggestion that DEPs be reduced or restricted, not only in the OEO channel but in retail investing more generally. With respect to finfluencers, we commend the CSA and CIRO for their work in this area, and the publication of guidance on the application of securities legislation to finfluencer activity. In our comments on the new guidance for OEO dealers, as well as on other occasions, the Panel recommended that the regulators consider whether additional measures are needed to regulate finfluencers. The Panel repeated that recommendation in our comments on the OSC’s draft statement of priorities in January 2026. The Panel also emphasized the need for disclosure that is accessible, clear, and easy to understand for investors, especially those in the DIY channel. We were pleased to offer support and suggestions on the proposed new Fund Report for investment funds and proposed new access model for disclosure by non-investment fund reporting issuers.

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Responding to Wrongdoing
Effective disruption and prosecution of misconduct are vital for investor protection and confidence in the capital markets. THE PANEL’S OBSERVATIONS:
Just as technology has transformed the capital markets, so too has it affected the nature and frequency of securities fraud. Bad actors are becoming increasingly sophisticated and new scams and frauds are proliferating. The development of AI and Gen AI also present risks; research published by the OSC in 2024 indicates the development of scams based on false claims of “AI-enhanced” investment opportunities, and the Osgoode Investor Protection Clinic has reported incidents of fraud based on the use of AI-generated deepfake videos. As noted in the OSC’s draft statement of priorities, “now more than ever regulators need to demonstrate that they have the tools and the capabilities to identify and deal with wrongdoing, including securities fraud.” Disruption has become an increasingly important tool in the fight against securities fraud, and Canadian securities regulators launched a new initiative in 2025 that led to the successful deactivation of fraudulent websites such as investment platforms and cryptocurrency websites. However, previous recommendations by the Capital Markets Modernization Taskforce and the Ontario Auditor General for modernizing enforcement, such as ticketing and freeze powers, have yet to be implemented. The Panel also continues to be concerned about the number of enforcement cases the Commission receives each year, as compared to the number that can be addressed, as well as the fragmented nature of securities fraud prosecution and reporting in Canada. THE PANEL’S RECOMMENDATIONS:
The Panel has advised that the OSC should work with the government to implement the recommendations of the Taskforce and Auditor General, including enhanced freeze powers, the power to dispose of frozen assets, and higher sanctions. We have also suggested that efforts be made to increase the number of enforcement cases that can be resolved each year, enhance partnerships with other organizations involved in the prosecution of securities fraud, and ensure the prosecution of financial crimes across the spectrum of losses. We recently reiterated these recommendations in our comments on the OSC’s draft statement of priorities. The Panel commends the OSC for its focus on disruption of online investment scams and frauds, and its commitment to advancing its enforcement strategies and tools, including adopting new technologies. As stated in our 2026 comments on the draft statement of priorities, the Panel agrees that regulators need strategies, tools and capabilities to identify and deal with wrongdoing, including new types of scams and frauds.

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Redress
Fair and effective dispute resolution processes are integral to investor protection, confidence in the capital markets, capital formation, and the quality and resilience of the financial sector as a whole. THE PANEL’S OBSERVATIONS:
Progress is being made to enhance the redress available to Ontario investors who have suffered from wrongdoing. The Panel was pleased to see the coming into force of the new statutory framework to facilitate the distribution of disgorged funds to harmed investors. We were also pleased to submit comments in support of CIRO’s proposals to allow for the distribution of disgorged funds and enhance its Arbitration Program. The Ombudsman for Banking Services and Investments (OBSI) continues to experience increased demand for its services. Although OBSI does not yet have binding decision-making authority, progress toward the conclusion of this initiative continued in 2025, with the publication of the proposed CSA oversight framework and refinements to the proposed regulatory framework. THE PANEL’S RECOMMENDATIONS:
In our comments to the CSA, the Panel once again expressed its support of binding decision￾making authority for OBSI, as well as our view that the conclusion of this initiative is long overdue. We reiterated our earlier recommendations that the CSA and legislatures in the participating jurisdictions work toward finalization and implementation as soon as possible. We repeated our suggestions that the regulators take steps to mitigate the risk of investor confusion following implementation, which we believe is likely given that the CSA’s proposed framework to grant OBSI binding decision-making authority contemplates a potentially staggered implementation across jurisdictions. The CSA should make the process as clear and easy to understand as possible, and make resources available to investors to assist in following the appropriate procedure in the applicable jurisdiction. The Panel once again expressed the view that the limit on compensation is too low and observed that it has not increased since OBSI was established in 1996. We recommended that, at a minimum, the limit be adjusted automatically with inflation going forward. The Panel also noted OBSI’s extensive expertise and experience and suggested that regulatory oversight be approached on a proportionate basis, with a view to achieving balance between the need for accountability and maintaining OBSI’s independence and established processes.

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Capital Markets
Effective investor protection relies on healthy, vibrant and safe capital markets. Accordingly, the OSC’s mandate to foster fair, efficient and competitive capital markets, and confidence therein, as well as to foster capital formation, is intertwined with the need for investor protection. The Panel’s work in 2025 reflected this approach. Our input to the OSC on these elements of its mandate focused on three key elements of the Commission’s work in this area: (1) right-sized regulation, (2) capital formation, and (3) competition.

• The rapid pace of change and new
  developments present challenges for the existing regulatory framework
• There is a need for right-sized regulation
• Thriving capital markets require both innovation
  and robust investor protection
• Investors should have a choice of investments
  supported by quality service
• There are concerns about regulatory
  compliance and sales practices in the industry The IAP recommends:
• Developing right-sized and responsive regulation with an investor protection lens
• Implementing safeguards in the context of ongoing advances in technology and emerging
  developments in the capital markets, such as novel product offerings
• Considering investor protection mechanisms that can support effective capital formation
• Providing guidance for industry participants to enhance compliance and ensure that investors
  are receiving high-quality services
• Balancing expanded investment opportunities against investor protection considerations

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Effective Regulation
Regulation is most effective when it can respond to rapid changes and emerging trends, while maintaining a focus on investor protection. THE PANEL’S OBSERVATIONS:
Many of our observations related to investors, set out earlier in this report, apply equally to our views on effective regulation. As noted in the OSC’s Strategic Plan, the Commission is “operating in an environment of accelerated change that is challenging the traditional model of regulation”. Many of the new developments affecting investors, such as the rise of AI and finfluencers, and the use of DEPs, present challenges for the existing regulatory framework, though the CSA has issued guidance regarding AI systems, finfluencers, and DEPs. Innovation has also led to changes in investment platforms and investment products. For example, the ETF market has evolved to include a much wider range of assets and more complex investing strategies, and the market continues to expand. 2025 was the first year where the launch of new ETFs outpaced that of mutual funds, and the data clearly shows that Canadian investors have chosen ETFs as the preferred retail product wrapper rather than mutual funds. For The First Time in 2025, ETF Launches Outpaced Mutual Fund Launches 2025 saw a surge in the number of ETFs launched in Canada. Even excluding single stock ETFs (of which there were 50 launched in 2025), a whopping 56% (212 out of 374) were launched as ETFs. -600 -400 -200 0 200 400 600 ETFs Launched MFs Launched ETFs Closed MFs Closed 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 Source: Morningstar Direct | Data as of Dec 31, 2025

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Est. Net Asset Flows in 2025 Were Decidedly Skewed Toward ETFs Both Canadian-domiciled ETFs and Mutual Funds waw positive net Inflows over 2025, with investors’ dollars decidedly choosing ETFs over MFs as the preferred wrapper. Exchange-Traded Fund Open-End Fund 20.0B 0.0 -6.0B 2023 2024 2025 Source: Morningstar Direct | Data as of Dec 31, 2025. Canadian-Domiciled Mutual Funds 7 ETFs, Excludes Fund of Funds, Excludes Institutional Share Classes and OM Products, Includes Liquidated Funds, n = 12,286. Significantly, many of the new products launched in 2025 are a notable departure from the traditional passively managed basket of diversified investments, including single-stock ETFs and funds that hold positions in digital currencies. 2025 saw increased investments in digital-asset ETFs, which is a matter of concern for the Panel as these types of investments are anticipated to exhibit much higher volatility than a more traditional ETF. Similarly, the Osgoode Investor Protection Clinic has noted that OEO platforms and their functionalities are increasingly complex, and “may exceed the financial literacy and risk tolerance of many retail investors.” Additional tools and supports for investors may assist in navigating these challenges. At the same time, the OSC has recognized the need for right-sized regulation. As stated in the Strategic Plan, the regulator “must ensure that all elements of our regulatory framework remain consistent, risk-informed, and relevant”. Reducing regulatory burden is important to maintaining efficient capital markets, but red-tape reduction may have an impact on investor protection. Work in furtherance of right-sized regulation, as with the OSC’s mandate as a whole, can be best realized if it is considered against the backdrop of investor needs and protection.

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THE PANEL’S RECOMMENDATIONS:
As noted in the CSA’s consultation on the use of AI systems in capital markets, AI systems have the potential to enhance the investor experience, and increase both efficiencies and competition in the capital markets. However, as noted in our comments on the consultation, the use of AI also presents potential risks to investors and investor protection. The Panel is most concerned about:
a. the risk of AI tools gathering information from sources that have not been verified for accuracy and completeness, or that have inherent biases; b. cybersecurity and privacy of client information;
c. risks arising from the input stage, including unintentional biases from data inputs,
as well as prompt design, AI literacy, and the need to ensure the absence of conflicts of interest; d. the need for investors to be informed about the use of AI (including the reliability of data), and that disclosure be clear and easy to understand; e. the need for ongoing validation and monitoring, to ensure that AI systems operate as intended and adapt to changes without unintended consequences, as well as a method of intervention to override AI systems that pose risks to investors; and f. the use of AI in scams and fraud. We recommended a principles-based approach and the inclusion of a “human in the loop”. It is critical that human judgment be applied to ensure that AI systems are used ethically, responsibly and in the investor’s best interest. As noted in our recent comments on the draft statement of priorities, we acknowledge that securities laws are technology-neutral, and we appreciate the guidance provided by the CSA in December 2024. The Panel suggested in both those comments and our comments on the AI consultation that the regulators provide additional guidance or standards to ensure that registrants are taking a consistent approach to the use of AI in the capital markets, as “regulatory certainty fosters prudent innovation”. Regulators need to provide guidance and expectations so that responsibilities (including liabilities) for the risks associated with the deployment and use of AI tools and strategies are clear to all market participants and investors. Disclosure is a key component of investor protection, and as such our recommendations with respect to ETF regulation were focused on ensuring that any additional disclosure by ETFs be clear, easy to understand, and refer to the reason for the disclosure and why it should be considered when making an investment decision. The Panel also supports disclosure that provides transparency and the ability to compare investment products, as noted in our comments on both ETF regulation and the modernization of continuous disclosure for investment funds. Disclosure should reduce confusion, and we recommended that the regulator consider this issue in determining whether to require ETFs to provide disclosure related to the structure of ETFs and the arbitrage mechanism. Throughout 2025, the Panel frequently recommended that the Commission’s work should prioritize investor protection. This recommendation applies equally to the OSC’s efforts to provide regulation that is proportionate and appropriate, and responsive to the rapid pace of change, as noted in our comments on the draft statement of priorities in 2026.

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Capital Formation
Robust capital formation goes hand-in-hand with robust investor protection and redress. THE PANEL’S OBSERVATIONS:
In its Strategic Plan, the OSC has committed to ensuring that the regulatory environment is supportive of innovation and growth, and welcoming to new products, services and methods. As noted in its 2024 proposal to facilitate investment opportunities in long-term illiquid assets through an investment fund product structure (Long-Term Asset Proposal), the OSC’s work in this area seeks to “enable businesses in Ontario to raise more capital to meet their needs for growth, improve financing availability at all stages of business growth across the private and public markets, and expand investment opportunities for a broad range of investors”. At the same time, as noted in the CSA business plan, capital formation is best supported by a robust, modern and efficient regulatory framework. THE PANEL’S RECOMMENDATIONS:
The Panel is supportive of initiatives that will facilitate capital formation. However, as noted in our comments on the Long-Term Asset Proposal and the proposal for a pilot project to permit semi-annual reporting for certain venture issuers, the OSC’s work in this area should consider the impact of any such initiatives on investor protection, and consider the investor protection mechanisms that can support effective capital formation. For example, the Panel’s view was that the Long-Term Asset Proposal raised a significant number of investor protection issues, and recommended that the initiative should not be a priority for the OSC. We were concerned that the proposed investments would not be suitable for the average retail investor, presented complex risks for retail investors, and that investors would not understand the risks or suitability of the investment. We identified several issues for the Commission to consider, including whether disclosure could adequately explain the unique features of the proposed investments, and that the nature of the investments would warrant elevated standards for suitability assessments. We suggested that if the initiative proceeded, various measures would be required in the interests of investor protection, including enhanced disclosure and reporting, investor interventions such as risk acknowledgements and attestations of understanding, strict rules of valuation (including mandatory third-party independent valuations), and specific governance requirements. The Panel also questioned whether the regulator should encourage investor interest in any specific asset class. The Panel also recommended that capital formation initiatives include appropriate investor protection in January 2026, in our comments on the proposed self-certified investor prospectus exemption.

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With respect to semi-annual reporting, the Panel expressed concerns about the impact of this initiative on investors’ ability to make informed investment decisions. We also made suggestions to further mitigate the potential risks to investors of less frequent reporting, including strengthening the criteria and conditions to be met by an issuer participating in the pilot project, rigorous adherence by issuers to their continuous disclosure obligations, and the provision of interim non-GAAP data to investors.

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Competition
Investors expect and deserve ready access to both a range of investment products and high-quality service. Investors’ interests should be considered in fostering competitive capital markets. THE PANEL’S OBSERVATIONS:
The Panel’s work in 2025 focused both on competition between firms and the choices available to investors, and on the OSC’s mandate to foster competitive capital markets. The Panel has previously raised concerns about a potential lack of competition and choices for investors, such as restricted product shelves offered by firms. In 2025, the OSC noted that “limited competition can have an adverse effect on service offerings in certain distribution channels”, and committed to a continuing focus on the choices available to investors and the quality of service they can obtain. The CSA and CIRO conducted a review of registrants’ practices under the Client Focused Reforms (CFRs), the results of which were published in December 2025. The review revealed that compliance with the CFRs has not been consistent across the industry. Key areas of concern for the Panel include:
a. many firms lacked an adequate process to collect sufficient information from clients about their risk tolerance and risk capacity, and to use that information to determine the client’s risk profile, b. many firms did not have sufficient documentation to show compliance with the “Know Your Product” (KYP) requirements of the CFRs,
c. some firms using model portfolios did not have any KYP assessment documentation,
d. some firms had inadequate processes for monitoring products for significant changes, e. some firms did not assess securities of related or connected issuers, f. many firms had not updated their suitability determination processes to ensure compliance with the CFRs, and g. there was inconsistency in training programs related to the CFR requirements. In 2025, the OSC and CIRO also conducted a review of sales practices by bank-affiliated mutual fund dealers. The results of the survey raise concerns about product recommendations and dealer knowledge. The survey found that, at least sometimes, product recommendations have been made that are not in the best interests of clients, and clients have been provided with information that is incorrect. With respect to product shelves, 94% of respondents reported that they could only offer proprietary funds. While the majority of dealers stated that the existing range of products met their clients’ needs, almost half agreed that clients would benefit from a broader range of mutual funds, including non-proprietary funds. The bank sales practices review also highlighted concerns about inadequate training that also arose in the CFR review.

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With respect to the competitiveness of Ontario’s capital markets, there is a growing focus on competitiveness not only within Canada, but also within the financial landscape more broadly. There are ongoing changes in the geopolitical environment, including changes to securities regulation in other jurisdictions, which are a matter of concern. As stated in the draft statement of priorities for the coming fiscal year, the regulator is operating “in an environment marked by uncertainty and an intensified focus on competitiveness”. THE PANEL’S RECOMMENDATIONS:
The Panel commends the CSA and CIRO for their recent Joint Staff Notice regarding the CFRs. The Panel has previously recommended the publication of additional guidance. Most recently, we addressed concerns about the inconsistent application of CFR requirements in the context of the CSA’s proposed amendments to the principal distributor model. In our comments, we recognized the importance of compliance sweeps, but suggested that both industry participants and investors would benefit from a comprehensive evaluation of the CFRs against the original objectives that led to their development. The Panel recommended changes to the proposed amendments to bring issues such as the limited product shelf and corresponding limited capacity to conduct a suitability assessment to the forefront. In January 2026, we recommended that the OSC prioritize a response to the sales practices survey, and suggested steps that could be taken to address the concerns identified in the results, including providing information to retail branch clients about the duties owed to customers by branch employees, and revisiting what is considered a “reasonable range of alternatives” when it comes to proprietary product shelves. While the Panel has raised concerns about competition, in many respects retail investors have more choices than ever before, which increases the need for investor protection. Investors benefit from having more choice (such as the range of products available in the robust ETF market), but they must also be afforded appropriate safeguards, especially as the sheer number of vastly different investment products with virtually frictionless access points are made available to the average Canadian investor. The Panel has often recommended that investor protection be considered across all elements of the OSC’s mandate, including work in furtherance of fostering competitive capital markets. In our comments on the Long-Term Asset Proposal, we noted the importance of suitability assessments in the context of proposed investment products that presented complex risks for retail investors, and the need for such products to be sold only in the advisory channel. This is a good example of the need for balance between investor protection and increased competitiveness in the capital markets, especially when considering international competitiveness. Despite global pressure to expand investment opportunities to potentially risky alternative assets, consideration must be given to whether such investments are suitable for the average retail investor. With respect to the competitiveness of Ontario’s capital markets internationally, the Panel recommended that the OSC continue to carefully consider new issues, such as tokenization, and their associated risks. We suggested that the regulator should recommend caution where warranted, and noted that the regulator’s continued focus on investor protection will contribute to strengthening Canada’s position in the global marketplace.

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Engagement
The OSC’s work with domestic and international partners and organizations is essential to its work across all elements of its mandate. Throughout our work, the Panel recognizes the importance of collaboration and harmonization with other regulators both in Canada and abroad.

• Regulatory consistency enhances
  investor protection
• Information sharing and collaboration
  promotes efficiency and responsiveness
• The geopolitical environment is a source
  of uncertainty and concern for Canadian firms and investors
• The Panel commends the regulator for
  its efforts to reduce and guard against systemic risk The IAP recommends:
• Continuing efforts to harmonize securities regulation
• Collaborating with regulatory partners in the financial sector to address issues that go beyond
  securities regulation, such as account transfers
• Continuing careful consideration of new issues and their associated risks, and recommending
  caution where warranted
• Maintaining focus on investor protection, fairness, and the rule of law

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Domestic Engagement
Harmonization and collaboration across regulators enhances investor protection. THE PANEL’S OBSERVATIONS:
Throughout 2025, the OSC continued its efforts to harmonize securities regulation and appropriately delegate functions to CIRO as a way to efficiently allocate resources. The OSC also maintained its focus on maintaining the stability of the financial system, through information sharing and collaboration with its Canadian counterparts and other bodies such as the Canadian Public Accountability Board. The Panel commends the OSC for its continued efforts to ensure consistency across the regulatory landscape, and to guard against systemic risk. The Panel supports the OSC’s outreach to Ontario investors and was pleased to engage with OSC Staff on various issues in this area, including the Action Plan for Truth and Reconciliation, investor education and outreach, and the OSC’s work to deepen its understanding of individual investor challenges and opportunities. Other work by the Panel in this area in 2025 is discussed in the “Investor Awareness and Education” section of this Report. THE PANEL’S RECOMMENDATIONS:
The Panel supports harmonization, both of securities regulation across Canada and as between different financial services regulators. Throughout 2025, we offered suggestions that, in our view, would enhance consistency and collaboration. For example:
a. in addressing the proposed ban on the use of chargebacks, the Panel encouraged the OSC and CSA to work closely with FSRA and FSRA’s counterparts towards harmonization across the financial services industry, b. we recommended that further steps be taken to address delays and achieve consistency in the processing of account transfers, not only by CIRO Members but by other financial institutions, agents and dealers, and
c. in 2026, we expressed our support for harmonization, as well as enhancing the
OSC’s efficiency internally, in response to a number of the priorities identified in the draft statement of priorities, including AI, prospectus exemptions, and re-alignment of functions between the OSC and CIRO.

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International Engagement
Despite ongoing shifts in the international landscape, the fundamental principles of securities regulation remain the same. THE PANEL’S OBSERVATIONS:
The OSC works collaboratively with international working groups on various issues of importance to Ontario investors and the capital markets. The Commission’s work on AI includes participation in the IOSCO Fintech Task Force and the Financial Industry Forum on Artificial Intelligence, as well as co-leading the Committee on Retail Investors’ AI workgroup, which is running a TechSprint on AI education tools for investors. The OSC is a member of the IOSCO Board, and participates in a range of IOSCO working groups and committees, including the Financial Stability Engagement Group, the Committee on Enforcement and the Exchange of Information, the Committee on Retail Investors, and the Committee on Emerging Risks. In addition, the OSC monitors international developments and their potential impacts on Ontario investors and capital markets, such as changes to securities regulatory policy in the United States. As noted in the OSC’s Business Plan for 2026-2028, “the geopolitical environment is a source of considerable uncertainty and concern for Canadian firms and investors”. Respondents to the 2025 CSA Systemic Risk Survey identified geopolitical trade and conflict as major concerns. THE PANEL’S RECOMMENDATIONS:
The Panel commends the OSC for its leadership and work with IOSCO and other international stakeholders. In 2025, we were pleased to engage with OSC Staff on the OSC’s contribution to promoting financial stability, the Strategic Plan and the work of the Strategic Regulation Division. We also gained a greater understanding of the nature of the risks facing Ontario investors in our meetings with external organizations such as Fidelity Investments. As we stated in early 2026, we encourage the OSC to continue this important work, and to continue carefully considering new developments such as tokenization and stablecoins and their associated systemic and other risks. We also recommend that the OSC pursue initiatives in furtherance of international harmonization with a view not only to enhancing capital formation and competitiveness, but also investor protection.

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The Year Ahead
In 2026, the Panel will continue to advise the OSC with respect to the interests of investors so they may be considered across all elements of the OSC’s mandate. Our work in 2025 demonstrated that investor protection cannot and should not be separated from the OSC’s work in developing fair, efficient and competitive capital markets, fostering capital formation, and contributing to the stability of the financial system and the reduction of systemic risk. Enhancing investor protection also serves to increase confidence in the capital markets. In early 2026, we provided extensive comments on the OSC’s draft statement of priorities for the coming fiscal year. The issues identified in those comments will be a focus for the Panel throughout 2026, including:
a. the rapid pace of change and innovation, and the impact of new developments on retail investors and the capital markets, b. the need for new strategies and tools to respond to technology driven change,
c. assessment of whether modernization of the regulatory framework
is warranted, d. harmonization and efficiency in securities regulation in Canada, and e. proportionate and appropriate regulation that maintains a focus on investor protection and the rule of law. In 2026, we will continue to develop our knowledge and understanding of issues affecting investors, capital markets, and outreach. The Panel takes a keen interest in research and publications on issues affecting retail investors, and we plan to engage with subject-matter experts and external organizations to enhance our understanding of issues such as AI in support of our work. We look forward to engaging with OSC Staff on initiatives related to enforcement, assessing investor challenges and opportunities, CFRs and other issues affecting retail investors.

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About the IAP
The IAP is an independent advisory panel to the Ontario Securities Commission. The IAP’s mandate, membership terms, operating procedures and remuneration and budget are set out in its Terms of Reference. Our Mandate Our mandate is to solicit and represent the views of investors on the Commission’s policy and rule-making initiatives. In order to fulfill our mandate, the IAP will:

• Advise and comment in writing on proposed rules, policies, concept papers and
  discussion drafts, including the Commission’s annual statement of priorities,
• Consider views representative of a broad range of investors through consultation
  with and input from investors and organizations representing investors in formulating its advice and written submissions to the Commission,
• Bring forward for the Commission’s consideration policy issues that may emerge
  as a result of the IAP’s investor consultation activities and comments on the potential implications for investors posed by those issues,
• Advise and comment in writing on the effectiveness of the investor protection
  initiatives implemented by the Commission, and
• Engage with other advisory committees to the Commission, as necessary, to
  contribute to the retail investor perspective on matters before those committees Investors are welcome to contact the IAP by email at:
  iap@osc.ca or by writing to:
  Investor Advisory Panel c/o The Investor Office Ontario Securities Commission 20 Queen Street West, 22nd Floor Toronto, ON M5H 3S8

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Our Membership
The IAP is comprised of members appointed by a selection committee composed of the Chief Executive Officer of the Commission and two Executive Vice Presidents following a public application process. Members of the IAP are appointed for terms of up to two years, with possible reappointment for one additional term. How We Operate The IAP generally meets monthly, in person and/or by video conference. We maintain frequent contact between meetings to develop our written submissions and to share and exchange views on developments in securities law and other relevant matters. During our meetings, we discuss upcoming submissions and plans for future outreach, research and consultation. Our work plan is set to a large extent by the Commission’s priorities and current developments in the investment industry. Our meeting agendas often will focus on specific OSC initiatives, including the Commission’s annual statement of priorities and business plan, policy and rule proposals, and ongoing or under-development investor protection initiatives. Independence The IAP conducts its activities without direction or influence from the Commission. The OSC Investor Office serves as the general liaison between the IAP and the Commission and serves as secretariat to the IAP. The Investor Office provides administrative support to IAP activities and facilitates our requests for staff briefings or research information conducted by, or available to, the Commission on specific policy and rule-making initiatives.

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Transparency
Transparency of our work is important. We provide regular reporting through the Investor Advisory Panel section of the OSC website, through our published reports, submissions, letters to the Commission and our Annual Report. We publish all meeting agendas on our webpage. Consultations To assist us in fulfilling our mandate, we consult with organizations and financial and legal experts, industry associations and investor advocacy bodies.

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IAP Members - 2025
Daniel Bach
Mr. Bach is a partner at Siskinds LLP, with extensive experience in investor recovery and dispute resolution on behalf of plaintiffs. His practice includes complex securities and consumer-related class actions on behalf of individuals, asset managers and pension funds. He is the past Chair of the Advocates Society’s Securities Litigation Practice Group, and teaches, speaks and has published in the areas of securities litigation, corporate governance and class proceedings. Gail Henderson Dr. Henderson, Allgood Professor in Business Law at Queen’s University Faculty of Law, is a legal scholar whose areas of research and teaching include securities regulation, consumer financial protection, financial literacy and investor education, with particular focus on vulnerable consumers. She was principal investigator on a research project on financial literacy in Ontario elementary schools. Dr. Henderson completed a five-year term as a member of the Financial Consumer Agency of Canada’s Consumer Protection Advisory Committee. Deborah Leckman Ms. Leckman is a member of various boards and committees, serves as an advisor to the Investor Protection Clinic at Osgoode Hall Law School, and is a former Commissioner to the Ontario Securities Commission. A CFA Charterholder, Ms. Leckman is a senior investment professional with over 30 years experience in retail wealth and institutional fund management, and has held executive roles in the private and public sectors. Parham Nasseri Mr. Nasseri has spent two decades translating complex regulatory requirements into technology solutions that enhance outcomes for both investors and advisors. With extensive experience in regulatory advocacy, digital transformation, and investment analytics, he has held senior leadership roles across the wealth management and financial services industry. Mr. Nasseri is currently the President of InvestorCOM, a leading software solutions provider for the financial services industry. He also serves on multiple advisory roles, including the CFA Societies’ Canadian Advocacy Council, the Canadian RegTech Association, and Junior Achievement of Central Ontario.

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Rozanne Reszel
Ms. Reszel, the former President and Chief Executive Officer of the Canadian Investor Protection Fund, is an experienced executive with strong financial services, regulatory and governance expertise. Among other distinctions, she is a Fellow of the Institute of Chartered Accountants, a Chartered Financial Analyst, and has an MBA from Harvard’s Graduate School of Business. Ms. Reszel is a former director of the OSC’s Investor Education Fund and has significant experience in risk management, securities policy initiatives and stakeholder engagement. Jacqueline Sanz Ms. Sanz has over 30 years of financial services experience, with deep expertise in securities regulatory compliance and risk management. A Chartered Professional Accountant and Chartered Accountant, Ms. Sanz has led the development of client-centric anti-money laundering, complaint handling, privacy and securities compliance programs. She has held senior compliance and internal audit roles at investment firms, and is currently responsible for the Canadian Risk & Compliance practice at Protiviti, a global consulting firm. Nathan Shaheen Mr. Shaheen, a Partner at Bennett Jones LLP, has extensive experience working on behalf of victims of domestic and international fraud and complex financial crimes. He investigates financial wrongdoing, traces and safeguards misappropriated assets, and acts in civil claims against perpetrators and third-party facilitators. An expert in Canada’s anti-money laundering regime, Mr. Shaheen is a highly sought-after thought leader who is regularly published in leading industry journals and speaks on emerging legal and regulatory issues. James (Jim) Sinclair, Chair Mr. Sinclair has over 35 years of experience providing legal services in a wide variety of capital markets settings, often with a focus on investor protection and issues facing investors. Most recently, he served as General Counsel at Common Wealth, a company that offers a digital retirement platform to help Canadians achieve their retirement goals. Prior to that role, Mr. Sinclair served for over five years as General Counsel at the Ontario Securities Commission and was appointed Acting Director of Enforcement for some of that time, during which he helped usher in the OSC Whistleblower Program. Prior to joining the OSC, he was the Director of Legal Services at the Ontario Ministry of Finance, where he was engaged in significant securities, pension, insurance and tax reform. Before joining the Ministry, he was Chief Legal and Compliance Officer at a large investment management firm.

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Ian Tam
Mr. Tam has over 15 years of financial services experience, and currently serves as Director, Investment Research at Morningstar Canada. His responsibilities include ensuring the relevance and visibility of Morningstar’s data, research, ratings and thought leadership among investors, as well as participating in public consultations and speaking engagements on significant securities regulatory developments. He is the former Chair of the Canadian Investment Funds Standards Committee, a CFA Charterholder, and a member of the CFA Institute’s ESG Technical Committee. Outgoing Members:
We extend our thanks and recognize the service of Brigitte Catellier, Supriya Kapoor and Ilana Singer (former Chair of the Panel), whose terms on the IAP concluded in 2025.

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Consultation:
External Organizations
Canadian Public Accountability Board

• Carol Paradine – Chief Executive Officer
• Jeremy Justin – Vice President, External Outreach
  Canadian Securities Administrators Investor Advisory Panel Fidelity Investments Canada ULC
• Robert Sklar – Director, Legal Services, Retail and Marketing
• Steven Rocca – Head of Fidelity Capital Markets Risk
• Anton Marchuk – Senior Vice President, Head of Fidelity Institutional Quantitative Risk
  Ombudsman for Banking Services and Investments
• Sarah Bradley – Ombudsman and CEO
• Mark Wright – Director of Communications & Stakeholder Relations
  Osgoode Investor Protection Clinic
• Shirine (Nazshirin) Haghjou – Student Caseworker
• Lina Kohandani – Student Caseworker

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Consultation:
Ontario Securities Commission Staff
The following topics were discussed:

• Access Instead of Delivery for Investment Funds
• Approaches to Enforcement
• CIRO’s Proposed New Guidance on OEO Account Services and Activities
• Compliance Oversight of the Exempt Market
• Digital Engagement Practices: Focused Compliance Examination of Online Retail
  Platforms
• Framework for Assessing Investor Challenges and Opportunities
• Guidance on the Application of Securities Legislation to Finfluencer Activity
• Investor Education and Outreach
• Liquidity Risk Management Tools, Liquidity Classification, and Regulatory Disclosure
  and Data – Consultation Paper
• Modernization of Continuous Disclosure Regime for Investment Funds
• Opportunity to Improve Retail Investor Access to Long-Term Assets through
  Investment Fund Product Structures – Next Steps
• OSC Action Plan for Truth and Reconciliation
• OSC Strategic Plan and Strategic Regulation Division
• Oversight of CIRO and the Canadian Investor Protection Fund – Update
• Sales Culture Concerns at Five of Canada’s Bank-Affiliated Dealers
• Self-Certified Investor Prospectus Exemption
• Social Media and Retail Investing: The Rise of Finfluencers – Review of Research
• Strengthening OBSI’s Powers to Secure Redress for Investors
• The OSC’s Contribution to Promoting Financial Stability
  The IAP met with the following Divisions and Departments of the organization:
• Corporate Finance
• Enforcement
• General Counsel’s Department
• Investment Management
• Investor Office
• Office of Economic Growth and Innovation
• Registration, Inspections and Examinations
• Regulatory Transformation and Strategic Research
• Strategic Regulation
• Trading and Markets

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Submissions, Letters and Reports
January 20, 2025
Distributing Funds Disgorged and Collected through CIRO Disciplinary Proceedings to Harmed Investors (Phase II) January 31, 2025 Proposal to Modernize the CIRO Arbitration Program January 31, 2025 Modernization of the Continuous Disclosure Regime for Investment Funds February 7, 2025 Opportunity to Improve Retail Investor Access to Long-Term Assets through Investment Fund Product Structures February 13, 2025 Proposed Amendments and Proposed Changes to Implement an Access Model for Certain Continuous Disclosure Documents of Non-Investment Fund Reporting Issuers February 26, 2025 Non-Tailored Advice in the Order Execution Only Channel March 31, 2025 CSA Staff Notice and Consultation 11-348 – Applicability of Canadian Securities Laws and the Use of Artificial Intelligence Systems in Capital Markets April 28, 2025 CSA Notice and Request for Comment – Proposed Amendments and Changes – the Principal Distributor Model May 27, 2025 OSC’s Investor Advisory Panel releases 2024 Annual Report September 24, 2025 Proposal to Prohibit the Use of Chargebacks in the Distribution of Investment Fund Securities September 29, 2025 Proposed Approach to Oversight and Refinements to the Proposed Binding Authority Framework for an Identified Ombudservice October 8, 2025 The Modernization of Requirements for Account Transfers and Bulk Account Movements October 31, 2025 OSC Action Plan for Truth and Reconciliation October 31, 2025 CSA Consultation Paper 81-409 – Enhancing Exchange-Traded Fund Regulation: Proposed Approaches and Discussion November 10, 2025 Proposed New Guidance on Order Execution Only Account Services and Activities December 19, 2025 Proposed Exemptions to Permit Semi-Annual Reporting for Certain Venture Issuers