FINMA - an independent supervisory authority

FINMA is Switzerland’s independent financial-markets regulator. Its mandate is to supervise banks, insurance companies, exchanges, securities dealers, collective investment schemes, and their asset managers and fund management companies. It also regulates distributors and insurance intermediaries. It is charged with protecting creditors, investors and policyholders. FINMA is responsible for ensuring that Switzerland’s financial markets function effectively.

FINMA's role

Supervision of the financial market and financial institutions

When FINMA commenced its activities on 1 January 2009, the Swiss parliament granted it a greater degree of independence than its three predecessor institutions. The institutional, functional and financial independence FINMA enjoys enables it to exercise effective supervision over Switzerland’s financial industry. 

Institutional independence

To ensure its institutional independence, FINMA was established as a public law institution in its own right. It is governed by a board of directors and managed by an executive board. This greater autonomy places more stringent requirements on FINMA’s management structures and the checks and balances underpinning them. Strong corporate governance is a key prerequisite for a credible, independent supervisory authority. 

Functional independence

Because FINMA is functionally independent of Switzerland’s political authorities, neither Swiss Parliament nor the government can issue directives on how it carries out its regulatory duties. While FINMA acts as an independent authority, it nevertheless forms part of Switzerland's political structures and the balancing and control mechanisms they incorporate. Most notably, it is subject to parliamentary scrutiny and must account to the parliamentary commissions overseeing its work. 

Financial independence

FINMA is financed not by the taxpayer, but by the levies and fees it charges for its supervisory work. In addition, the institutions FINMA regulates are required to pay an annual levy to cover the costs incurred by FINMA which are not met by the fees. The levies relate to supervision and other FINMA services. FINMA's accounts are audited by the Swiss Federal Audit Office. 

Mandate and tasks

FINMA is mandated to protect financial market clients – bond holders, other investors and policyholders – and is responsible for ensuring that Switzerland’s financial markets function effectively. Its supervisory tasks - authorisationsupervision and, where necessary, the enforcement of supervisory law – are derived from that mandate. In addition, FINMA can also regulate activities where it is authorised to do so. In performing its supervisory activities, FINMA adopts a systematic risk-oriented approach and is mindful to ensure continuity and accountability. This strengthens confidence in the proper functioning, integrity and competitiveness of Switzerland's financial centre.  

Strategy and organisation

Based on legally defined tasks and objectives, FINMA’s Board of Directors draws up strategic goals, which it submits to the Federal Council for approval every four years. To enable it to achieve its strategic goals, FINMA has an appropriate organisational structure with a clear distinction between strategic management through the Board of Directors and operational management through the Executive Board. The Board of Directors defines the strategic course, decides on transactions of substantial importance and oversees the Executive Board. Eight divisions ensure that FINMA fulfils its mandate efficiently and uses its financial resources responsibly and effectively. 

Deployment of third parties

In order to meet its goals, FINMA delegates part of its supervisory work to audit firms and also appoints agents who are deployed on a case-by-case basis. 

Cooperation in Switzerland and abroad

Ultimately, FINMA fosters national cooperation and, on the international stage, it represents Switzerland, its principle-based regulatory approach and the financial sector in competent specialist committees. It also responds to requests for assistance from foreign supervisory authorities.