Nobody really likes to be regulated: On the relationship of professionals to their regulatory bodies

By Claude Balthazard, Ph.D., C.Psych., CHRL
Vice-President, Regulatory Affairs and Registrar at HRPA

In a self-regulation regime, the relationship of professionals to their professional regulatory body can be complicated. On the one hand, the professional regulatory body is simply fulfilling a commitment that the members collectively made to promote and protect the public interest by regulating the practice of the profession; and yet, fulfilling this commitment can sometimes lead to a more adversarial relationship between members and their professional regulatory body.  An interesting event that gives insight into this complicated relationship happened in the consultations that preceded the passage of the Not-for-Profit Corporations Act, 2010[1] (ONCA).

In August of 2010, the Standing Committee on Social Policy held hearings on Bill 65, the then proposed Not-for-Profit Corporations Act, 2010. The impetus behind the Not-for-Profit Corporations Act, 2010 was to reform the governance of not-for-profit corporations by giving individual members more power—powers such as the ability of members to remove any director or directors from office by ordinary resolution at a special meeting, the ability to vote down some of the regulatory provisions the professional regulatory body would pass with respect to them, and give members the right to seek court-ordered investigations.

Four professional regulatory bodies made representations before the Committee: the Ontario Architects Association, the Law Society of Upper Canada, the College of Veterinarians of Ontario, and the Institute of Chartered Accountants of Ontario (note that two of these bodies were dual-object professional organizations—the Ontario Architects Association and the Institute of Chartered Accountants of Ontario–and two were single-object professional regulatory bodies—the Law Society of Upper Canada and the College of Veterinarians of Ontario).

The arguments put forth by these four professional regulatory bodies were very similar—(1) that the relationship of professional regulatory bodies to their members is not the same as the relationship of non-regulatory bodies to their members, and (2) if Bill 65 passed as proposed, members of professional regulatory bodies could use these powers to hinder the ability of their professional regulatory body to fulfill its public protection mandate.

For instance, the College of Veterinarians of Ontario argued[2]:

“The mandate the College has to regulate its members in the public interest places the College, as the Law Society pointed out, in a completely different relationship to its members than those a charity or a club would have with its organizations”

The Ontario Architects Association argued[3]:

“As a self-regulating profession, the rights of our members, who are regulated by the OAA, are different than the rights of members of a non-profit corporation.”

The Law Society of Upper Canada argued[4]:

“What you have to remember is that even though we are a not-for-profit, without share capital corporation, we are actually in the regulation business, so that our members are the people we regulate.”

For their part, the Institute of Chartered Accountants of Ontario noted[5]:

“We are a regulatory body. Frankly, if our members are happy with what we’re doing, we’re not doing our job.”

In the end, the Committee agreed with the professional regulatory bodies and called for exemptions to the Not-for-Profit Corporations Act, 2010 for professional regulatory bodies. Indeed, subsection 3 (5) of the Registered Human Resources Professionals Act, 2013, reads:

3 (5)  The Not-for-Profit Corporations Act, 2010 does not apply to the Association, except as may be prescribed by regulation.

What is interesting to note is the similarity of the arguments—the idea is that if given a chance, members, either individually or collectively, would act to limit or disable some of the regulatory powers of their professional regulatory body.

The reason may not be that complicated—nobody really likes to be regulated, and it really doesn’t make that much of a difference whether it’s self-regulation or direct regulation. It does not help that many professions are licensed—members of these professions may not feel that they chose to be regulated.  Interestingly, the issue seems to be the same in professions that are unlicensed such as accounting (with the exception of public accounting).

But regulation is part of a deal—a ‘social contract’ as Sullivan[6] puts it:

“In Canada and the United States the social basis of the extraordinary grant of occupational authority and independence to professionalized occupations such as medicine and law has been a social contract between the profession and the public… In exchange for a grant of authority to control key aspects of their market and working conditions through licensing and credentialling, professionals are expected to maintain high standards of competence and moral responsibility.”

From this perspective, regulation is all about holding up the profession’s side of the contract. What may be happening is that professionals may be losing sight of the quid-pro-quo nature of professional regulation.  Or perhaps there is a belief that the benefits of professionhood can be had without paying the price.

Indeed, many of the obligations and costs of professionhood are immediate and salient (i.e., dues, continuing professional development requirements, mandatory professional liability insurance requirements, various self-reporting requirements, abiding by various rules of professional conduct) whereas the benefits of professionhood are less tangible and less immediate (i.e., professional status, influence, respect, feeling like one is making a positive and valued contribution, remuneration).

The relationship of a professional regulatory body with its members has to be based on more than just the wielding of statutory powers. Without the connection to the benefits of professionhood, all that is left of professional regulation is burden and obligation.  It is important for professional regulatory bodies to remind members of the profession that protecting the public interest is in the enlightened self-interest of members.  The status and trust that the public puts in professionals is there only because professionals hold themselves to high standards of competence and trustworthiness.

Reflecting on the comment made by the Institute of Chartered Accountants of Ontario, perhaps the word ‘happy’ is just too much. The aim of a professional regulatory body is not to have ‘happy’ members, but rather ‘fully supportive’ members who understand why their professional regulatory body does what it does and who are confident that their professional regulatory body is doing the right things and doing things right with respect to protecting and promoting the public interest.

[1] There is no firm date when Ontario’s Not-For-Profit Corporations Act, 2010 (ONCA) will take effect. A new technical amendments bill will need to be re-introduced, debated and passed in a future session of the legislature. That means that the ONCA is unlikely to take effect until 2016.

[2] Ontario, Legislative Assembly, Official Report of Debates (Hansard), 39th Parl, 2nd Sess, Sp-204 (23 August 2010) (Ms. Susan Carlyle).

[3] Ontario, Legislative Assembly, Official Report of Debates (Hansard), 39th Parl, 2nd Sess, Sp-204 (23 August 2010) (Ms. Kristi Doyle).

[4] Ontario, Legislative Assembly, Official Report of Debates (Hansard), 39th Parl, 2nd Sess, Sp-206 (23 August 2010) (Mr. Malcolm Heins).

[5] Ontario, Legislative Assembly, Official Report of Debates (Hansard), 39th Parl, 2nd Sess, Sp-204 (23 August 2010) (Mr. Tom Warner).

[6] Sullivan, W. M. (2000).  Medicine under threat: professionalism and professional identity. Canadian Medical Association Journal, 162(5), 673-5.

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