CONSOB

Consob, or Commissione Nazionale per le Società e la Borsa, is the primary regulatory authority in Italy’s financial markets. Established in 1974, its role has evolved over the years to adapt to the changing landscape of the financial sector. This article takes a closer look at Consob Italy, including its history, scope, supervision, investor compensation guarantees, and organizational structure.

CONSOB History

Consob Italy was created as part of the Italian government’s response to the global financial crisis of the early 1970s. Established by the Consolidated Law on Finance (Testo Unico della Finanza, or TUF), the commission was initially tasked with overseeing securities markets and regulating the activities of brokerage firms. Over time, its mandate expanded to include the supervision of all financial intermediaries, listed companies, and market infrastructures.

CONSOB Scope and Supervision

Consob’s primary goal is to ensure the transparency, stability, and efficiency of Italy’s financial markets. To achieve this, the commission has a wide range of responsibilities, including:

1. Regulating and supervising financial intermediaries: Consob ensures that financial intermediaries, such as banks, investment firms, and asset management companies, adhere to strict regulations to protect investors and maintain market stability.
2. Supervising the issuance of securities: The commission oversees the issuance and trading of securities in Italy’s financial markets, ensuring companies follow proper disclosure requirements and investors have access to accurate information.
3. Monitoring market conduct: Consob monitors the conduct of market participants to prevent market abuse and maintain a fair and transparent trading environment.
4. Corporate governance oversight: The commission ensures that listed companies adhere to corporate governance rules, promoting transparency and fostering investor confidence.
5. Protecting retail investors: Consob works to educate investors and protect their interests through investor awareness campaigns and the enforcement of regulations.

CONSOB Investor Compensation Guarantees

Consob Italy is also responsible for managing the Investor Compensation Scheme (Fondo di Garanzia degli Investitori, or FGI). This fund provides compensation to retail investors in cases where a financial intermediary fails or becomes insolvent. Eligible investors can receive up to €20,000 in compensation, ensuring that they are protected from the adverse effects of financial firm failures.

Organization Type

Consob is an independent public authority that operates under the jurisdiction of the Italian Ministry of Economy and Finance. Its independence allows it to make impartial decisions in the best interest of the financial markets and investors. The commission is headed by a Chairman and four Commissioners, who are appointed by the President of Italy for a seven-year term.