Financial institutions in Canada operate under the regulation and supervision of the Office of the Superintendent of Financial Institutions (OSFI).

On January 28, 2013, the OSFI issued the final version of its revised guideline on corporate governance.  This revised guideline sets out OSFI's expectations for corporate governance for all federally regulated financial institutions and applies to all such institutions. A key feature is that financial institutions are required to develop and implement a board-approved risk appetite framework that is enterprise-wide and tailored to all of its domestic and international business activities and operations.  This requires a risk management system that links information on different risk types for all jurisdictions, to provide a holistic perspective on risk exposures. 

If a business unit, in this case the Barbados international business company (IBC), is of a nature which allows the financial institution to regulate compliance with its enterprise risk management policy on a consistent basis, this will provide significant benefit to the Canadian institution and enhance the likelihood of choosing Barbados.  A stable and consistent environment for the operation of business units, particularly those operating in foreign jurisdictions, will be a significant aid to implementation and oversight of enterprise risk management policies and practices.  Jurisdictions which can deliver this consistency will be a superior choice for business units and business activity. 

Enterprise risk management requires enterprise-wide assessment and controls.  Controls will generally need to operate, particularly for larger financial institutions, using automated, technology-based delivery of information on a two-way basis, relating to the ongoing assessment of risk and compliance with the enterprise risk management policies.  Barbados must deliver the ability to track and log issues, as well as prepare and undertake remediation plans for effective enterprise risk management.

A key factor to enterprise risk management is ensuring appropriate levels of compliance training are available throughout the organisation.   Barbados has the ability to provide this compliance and translate the requirements into consistency and regulatory approaches - valuable attributes for those jurisdictions looking to attract Canadian financial institutions to open business operations.  The continued enhancement of both IBC legislation and financial institution regulation in Barbados will establish the island as a key and effective choice of jurisdiction for offshore operations by Canadian financial institutions.  The ability to consistently integrate Barbados into enterprise-wide policies, practices and procedures as a consequence of the ready recognition of those requirements in Barbados and the similarity of the Barbados legal and business environment, aids in choosing it for offshore activity. 

Barbados' active involvement in meeting international standards for regulation of its financial services sector will also enhance enterprise-wide policies and oversight as the similarity of regulation, reporting and accounting in Barbados will fit readily with the enterprise-wide requirements for Canadian financial institutions.

The ability to have suitable ownership structured within the corporate group, allowing ownership to provide direction and guidance through a board of directors under the control of the Canadian financial institution, also greatly assists in integrating the Barbados IBC into the Canadian financial institution's enterprise.  The maintenance of the permitted ownership and direction of the corporation is a key factor in allowing Canadian financial institutions to readily choose Barbados as a jurisdiction in which they can operate business units and meet their risk management compliance requirements.

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