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Opening Remarks at Investor Advisory Committee Meeting

Chairman Elisse Walter

Jan. 18, 2013

Good morning. It is a pleasure to be with you today, and to make my first public appearance as SEC Chairman with you, a group who has chosen to dedicate yourselves to looking at the issues we face through the eyes of the investors we are dedicated to protect.

As you know, although I am new to the role of Chairman, I am proud to have worked at the SEC both as a staff member and a Commissioner for a total of more than two decades. I have made the SEC the cornerstone, and the heart, of my career because I strongly believe that the SEC’s mission of investor protection and market stability is critical to the function of and confidence in the financial system as a whole…and especially because I believe that investors need and deserve an effective advocate within the Federal government.

Today, thanks to our exceptional staff and strong leadership team, I believe that we are executing our role as the investor’s advocate boldly and effectively, at a time when our role has become more important than ever.

This is a challenging and exciting time for the Commission. Commissioners and the staff are considering a number of complex and important issues and working hard on rules that will have a profound and positive impact on investors and our markets for years to come. I am currently working with the other Commissioners to prioritize the many agenda items before us and to set a realistic timetable for executing on those priorities. With these discussions still under way, I can’t yet give you too many details. I will say, though, that I am confident that completing the remaining rulemakings and other projects mandated by the Dodd-Frank Act and the JOBS Act will be at the top of the list.

And despite the often-mentioned 2-2 divide, I find that my fellow commissioners — as well as Commission staff — are eager to find common ground and move forward in a practical and effective manner.

I’m also on something of a listening tour -- clarifying my own thoughts and keeping an appropriate perspective by listening to ideas, questions and complaints from people in and out of the agency. And, that is why I am here today — to listen to you.

The Investor Advisory Committee is the right idea, and particularly at this critical juncture in the history of our markets. Over the last decade, the retail investing landscape has become increasingly complex, populated by products, strategies, technologies, opportunities, and risks that simply didn’t exist just a short time ago.

And, on top of the changes that arise more or less organically from in the marketplace, important new legislation is reshaping the terrain, as well. Just 21 months after Dodd Frank, the most significant financial reform bill in decades, was enacted — and created this committee — the JOBS Act brought another seismic shift in the way companies, particularly small and emerging ones, raise capital and how individual investors participate in that process.

Against this backdrop, the decisions confronted by individual investors — decisions that are absolutely critical to the course of their lives and the lives of their families — and the information and advice they receive when they make these decisions, are becoming more complex even as the stakes grow higher.

As some of you may know, when I think about the SEC’s role at a time like this, I like to think of my very dear — if completely imaginary — Aunt Millie, a retail investor with a modest portfolio, looking towards a secure retirement — hopefully in the near term — and some fun with her family during her golden years. Now, as dear to me as she is, Aunt Millie is no hedge fund manager. So when she sits down with her financial professional, and the talk turns to ETFs and target date funds, crowdfunding or her professional’s fees, I want the SEC’s presence to be felt there in that office — whether or not she even knows anything about the SEC (although MY Aunt Millie is, of course, qvelling at her niece’s recent promotion), I want the SEC to be there looking out for her, helping her make sense of the environment in which she is investing her future security.

Aunt Millie and her fellow retail investors are unique among the major stakeholders in the financial system: they aren’t members of a trade association, and they don’t exactly spend a lot of time (or any time for that matter) following the Federal Register, monitoring the SEC, or — although I am trying to improve this — submitting substantive comments on proposed rules and concept releases. Like most retail investors, Aunt Millie is under-informed and underrepresented in the regulatory process.

That is why, in the midst of continuing and significant changes in the markets, your work is so important. You help represent these retail investors with a visibility and sophistication that ensures that their needs and interests are carefully considered. You help us keep the playing field level for all investors, including and especially investors like Aunt Millie and her compatriots. Your first set of recommendations to the Commission, on proposed rules that would lift the restriction on general solicitation in certain private placements, reflects your commitment to that task. I deeply appreciate the effort and thoughtfulness that went into crafting the recommendations.

In addition, your ability to work together and provide recommendations that were unanimously supported by the Committee is heartening to me and serves as an example to us all.

In a short time, you have established yourselves as an effective organization and a critical component of the ongoing regulatory dialogue that affects every American investor. I look forward to our continuing collaboration as you address other matters of critical importance in a relentlessly evolving financial world.

Thank you for what you have accomplished already and for what I know you will continue to do. I said earlier that we were still sorting out all of our priorities for the days ahead, but one of them is certainly this: continuing the close relationship that I believe we already have.

And, since I’m here as part of my listening tour and not my talking tour, it’s probably time for me to stop talking and start listening to any questions and comments you may have.

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