A public consultation on new procedures, issued by the IAIS on August 4, recommends abolishing the right of observer members to have open access to certain meetings. The proposal forms one part of a broader package of measures to improve the organisation's effectiveness. IAIS subcommittees will instead be allowed to invite observers and other external stakeholders as guests at their discretion. The consultation closes on September 2.

 

Insurance regulators can apply to be fully fledged members of the IAIS, with the right to take part in the organisation's various working parties, but insurers, trade associations and accounting firms can only apply for observer status. Current rules allow observers to attend some committee and subcommittee meetings and participate in seminars and conferences. The changes would end open access to key committees, including the implementation committee, which has responsibility for putting IAIS standards into practice, and the macroprudential policy and surveillance committee, which analyses systemic risk within the insurance industry.

 

Regulators and trade associations have been quick to denounce the proposals as a means of closing out healthy debate on key initiatives such as the Insurance Capital Standard (ICS) under development for internationally active insurance groups.

 

David Snyder, vice-president for international policy at the Property Casualty Insurers Association of America (PCIAA) in Chicago, says: "We see a lot of negatives behind these proposals. The organisation will ultimately become less transparent, which is ironic since when it comes to the important work the IAIS is engaged in like the ICS, they would benefit from more openness rather than less." PCIAA is an observer member of the IAIS.

 

Alisa Dolgova, London-based policy adviser for international affairs at the Association of British Insurers, another observer member of the IAIS, says shutting out observers may reduce the opportunity for stakeholders to raise "red flags" to certain proposals, but adds that the impact of the new procedures will largely depend on how different committee chairs interpret them.

 

The IAIS argues the changes will enhance the efficiency of their activities and streamline the process of obtaining stakeholder input. The association also stresses that it is important to see the proposed shift away from observer status as one part of a whole package of reforms designed to boost the engagement of all external stakeholders in policy development.

 

Other proposed changes to IAIS procedures include requiring the executive committee to hold at least one public meeting a year, and for all IAIS committees to consider hosting public dialogues and hearings on policy development where appropriate.

 

Yoshi Kawai, secretary general of the IAIS in Basel, says: "We acknowledge the concerns expressed so far, but believe it is important to take a step back and look at things in whole. Right now, there is a system in place in which only certain stakeholders are given enhanced access rights, such as the ability to attend hearings like the ComFrame and capital sessions we held recently. Instead of this system, we are proposing one in which any interested stakeholder can follow and participate in IAIS activities in an efficient, structured manner. We are also proposing opportunities to be involved that don't even exist today."

 

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