Keynote Address at the Inaugural OECD Roundtable on Global Financial Markets

Good afternoon, ladies and gentlemen. First, I should like to thank you, Secretary-General Cormann, for your warm introduction. Thanks also to Carmine for the invitation to participate in this inaugural roundtable and for having organized such a timely conversation on the ways in which we can work together to encourage global competition in the capital markets and to promote economic growth in our respective jurisdictions. I know that all of you are committed to these goals, as is demonstrated by your presence here today. It is my very special pleasure to be with you, especially as we at the Securities and Exchange Commission are returning to our core mandate of protecting investors; maintaining fair, orderly, and efficient markets; and facilitating capital formation.

Now, before I go further, I am sure that you appreciate that the views I express here are my own and do not necessarily reflect those of the SEC as an institution or of my fellow Commissioners. But for me, returning to France is a homecoming of sorts. In the late-1980s, I was a young lawyer in the Paris office of a New York law firm, learning as much about the intricacies of international finance as the enduring value of cooperation across cultures. In the decades since, multiple tours of duty at the SEC have further underscored to me how the principles we prize in the United States, among them the might of free enterprise and the vigor of capital markets, can find common cause abroad. And it is in that spirit that I welcome today's discussion on fueling growth and opportunity across our domestic economies.

Special Accommodations for Foreign Issuers

The topic of American and European collaboration is one that has fascinated me for many years. I remember well the run up to the "Big Bang" of 1992, which gave rise to the European single market-and to the sweeping tides of opportunity that would follow. For those of us who were here at the time, it was invigorating to watch the Internal European Market take shape, animated by the forces of commerce and competition-themes that are again in focus today as Europe considers the direction of the Savings and Investment Union, among other initiatives. At the same time, engagement outside of the new European market remained important, even for a continent knit more closely together. And of course, strong, sovereign nations like the United States must continue to work constructively with the world in ways that promote our prosperity.

At the SEC, these priorities find expression in our work to attract foreign companies to U.S. markets and provide Americans with the opportunity to invest in those companies while ensuring that U.S. and foreign firms experience a level playing field-and our investors are protected. Of course, the size and depth of the U.S. capital markets have been and still are attractive to non-U.S. companies. They can achieve a variety of potential benefits, including higher valuation, greater liquidity, access to American capital, and enhanced publicity and reputation in the financial markets.

Since the advent of the SEC, our rules have granted special accommodations for foreign companies that access the U.S. capital markets.^[i] These accommodations recognize the differences in business and market practices, accounting standards, and corporate governance requirements, among other matters, between U.S. and foreign companies. Still, the SEC has also been mindful of the need for U.S. investors to be equipped with adequate information about the foreign issuers and the extent to which such information was provided under the laws of their home country jurisdictions.

In 1983, the SEC developed the foundations of its current standard for which foreign companies qualify for these special accommodations.^[ii] Since then, the SEC has reassessed and updated this standard as needed to address changes in the global markets and to protect U.S. investors. In one of my first actions as Chairman, I asked the Commission to approve the issuance of a concept release to gather public feedback on whether this standard should be updated to reflect the evolution in financial markets and corporate legal structures.^[iii]

The concept release seeks public feedback on whether foreign companies listed in the United States should be subject to additional conditions-such as a minimum foreign trading volume or listing on a major foreign exchange-for them to receive accommodations not available to U.S. companies.

To be clear, the SEC welcomes foreign companies that seek to access the U.S. capital markets. The concept release is not a signal that the SEC intends to disincentivize such firms from listing on U.S. exchanges. Rather, our goal is to better understand the impact on U.S. investors and the U.S. market resulting from significant changes to the population of foreign companies listed in the United States over the last two decades. Among the notable changes are the makeup of foreign companies reporting to the SEC and the trend of incorporating in a jurisdiction, such as the Cayman Islands, that differs from where the company is headquartered, operates, and is subject to a governance framework that implicates shareholder interests. In light of these changes, does the SEC's original rationale for extending special accommodations to all foreign companies without qualification still make sense or should our rules be updated? Retrospective review of our rules to evaluate whether they continue to achieve their intended policy goals is one of the hallmarks of an effective regulatory agenda.

While the official comment period closed this past Monday, the SEC of course will consider input it receives after the due date in evaluating whether to propose rule changes. I look forward to reviewing the public feedback on this topic.

High-Quality Accounting Standards

As we look with fresh eyes at the types of foreign issuers that receive special accommodations, we should also not lose sight of the bedrock beneath any effective regulatory regime: high-quality accounting standards and financial materiality.

With respect to accounting standards, U.S. companies must prepare their financial statements in accordance with U.S. GAAP, or Generally Accepted Accounting Principles. During my previous tenure at the SEC as a Commissioner in 2007, I voted to support rule changes to permit foreign companies to present financial statements prepared in accordance with the International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB), without reconciliation to U.S. GAAP.^[iv]

When the SEC eliminated the reconciliation requirement, it noted that "the IASB's sustainability, governance and continued operation in a stand-alone manner as a standard setter are significant considerations in [eliminating the reconciliation requirement], as those factors relate to the ability of the IASB to continue to develop high-quality globally accepted standards."^[v] The SEC specifically noted the ability of the IASC Foundation, which was the predecessor to the IFRS Foundation, to obtain "stable funding" for the IASB.^[vi]

In 2021, the IFRS Foundation announced the formation of the International Sustainability Standards Board (ISSB), and its Trustees are now responsible for securing funding for both the IASB and the ISSB. This recent expansion of the IFRS Foundation's remit cannot divert its focus from its long-standing core responsibility of funding the IASB. In turn, the IASB must promote high-quality accounting standards that are focused solely on driving reliable financial reporting and are not used as a backdoor to achieve political or social agendas. Reliable financial reporting is critical to supporting capital allocation decisions. We all have a strong interest in the IASB's being fully funded and operational, and I encourage the IFRS Foundation to meet its goal for "stable funding" that prioritizes the IASB and its focus on standards for financial accounting, rather than specious and speculative issues.

If the IASB does not receive full, stable funding, then one of the underlying premises for the SEC's elimination of the reconciliation requirement for foreign companies in 2007 may no longer be valid, and we may need to engage in a retrospective review of that decision.

Financial Materiality

Of course, in addition to high-quality accounting standards, regulation based on financial materiality is another pillar of maximizing the efficient flow of capital. A focus on financial materiality means that disclosure requirements, corporate governance standards, and other regulations are aimed at interests of investors, who, after all, provide the capital to power the products, services, and jobs created by the corporation. In contrast, a regulatory regime based on double materiality considers other non-financial factors.

In the EU, two recently passed laws-the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD)-promote a double materiality regulatory approach. These laws also impact U.S. companies with operations in the EU.

I have significant concerns with the prescriptive nature of these laws and their burdens on U.S. companies, the costs of which are potentially passed on to American investors and customers. While I am encouraged by the EU's recent commitment to ensure that these laws do not pose undue restrictions on transatlantic trade,^[vii] as well as efforts to streamline and simplify these laws, further work remains to refocus regulatory regimes on the principle of financial, instead of double, materiality. Indeed, as Europe seeks to promote its capital markets by attracting more companies and investment, it should focus on reducing unnecessary reporting burdens on issuers rather than pursuing ends that are unrelated to the economic success of companies and to the well-being of their shareholders.

Project Crypto

As we call on our partners to foster investor confidence and dynamic markets in their jurisdictions, these same priorities compel us, in the United States, to unleash the potential of digital assets in ours.

As I referenced earlier today, in the late 1980s I worked about four kilometers from where we are convening now-on the Place de la Concorde. At the time, I could hardly have imagined returning in my current role to speak of new technologies, including those that once were dismissed or resisted outright, yet are now revolutionizing global finance. It seems only fitting, here just steps from Avenue Victor Hugo, to summon his words to our moment, "on résiste à l'invasion des armées; on ne résiste pas à l'invasion des idées"-an invasion of armies can be resisted, but not an idea whose time has come.^[viii] And today, ladies and gentlemen, we must admit that: crypto's time has come.

For too long, the SEC has weaponized its investigatory, subpoena, and enforcement authorities to subvert the crypto industry. That approach was not only ineffective, but injurious; it drove jobs, innovation, and capital overseas. American entrepreneurs bore the brunt-and have been forced to spend fortunes on building a legal defense instead of a business. That chapter belongs to history.

It is a new day at the SEC. Policy will no longer be set by ad hoc enforcement actions. We will provide clear, predictable rules of the road so that innovators can thrive in the United States. President Trump has tasked me and my counterparts across the Administration with making America the crypto capital of the world-and the President's Working Group on Digital Asset Markets has delivered a bold blueprint to guide us in these efforts.

As Congress drafts comprehensive legislation, the Working Group has directed U.S. regulators to move swiftly toward modernizing our outdated rulebooks. At the agency, we are delivering on this mandate through Project Crypto, a sweeping initiative to modernize the securities rules and regulations to enable our markets to move on-chain. Our priorities are clear: we must provide certainty regarding the security status of crypto assets. Most crypto tokens are not securities, and we will draw the lines clearly. We must ensure that entrepreneurs can raise capital on-chain without endless legal uncertainty. And we must allow for "super-app" trading platform innovation that increases choice for market participants. Platforms should be able to offer trading, lending, and staking under a single regulatory umbrella. Investors, advisers, and broker-dealers should have freedom to choose among multiple custody solutions as well.

Meanwhile, in keeping with the recent Working Group report, the SEC will work with other agencies so that a platform can offer trading in crypto assets (whether or not they are securities), along with services like staking and lending, under a single regulatory umbrella. I believe regulators should provide the minimum effective dose of regulation needed to protect investors, and no more. We should not overburden entrepreneurs with duplicative rules that only the largest incumbents can bear. By unleashing venue and product competition, we can help to ensure that American companies compete globally on a level playing field.

President Trump calls America a "nation of builders." Under my chairmanship, the SEC will encourage those builders, not suffocate them under red tape. Our goal is simple: to spark a golden age of financial innovation on U.S. soil. Whether through tokenized stock ledgers or entirely new asset classes, we want breakthroughs to be made in America's markets, under American oversight, for the benefit of American investors.

Opportunities for Collaboration with International Counterparts

Of course, these priorities can reach their fullest potential when we work strategically with international partners who share our commitment to innovation and to regulatory clarity. Markets prosper when capital flows freely to its most productive uses. And public blockchains, inherently global, offer a rare chance to modernize the foundations of payments and capital markets. By working together, the United States and Europe can strengthen our domestic economies while reinforcing our transatlantic partnership. Europe, much to its credit, has moved early. As the Digital Asset Markets report recognized, the EU's Markets in Crypto-Assets (MiCA) regulation exemplifies a comprehensive digital assets regime. Some European policy makers have already called for a "MiCA 2" to address decentralized finance, non-fungible tokens, and digital asset lending.^[ix] I applaud our European allies for their foresight in this initial attempt at regulatory clarity and think it is paramount for the United States to learn from these efforts.

That said, I am determined to ensure that America is second to none in fostering an economic climate that supports financial innovation.^[x] As we catch up, I look forward to collaborating with our international counterparts to facilitate more innovative markets. Working together, as Alexandre de Tocqueville might have put it, we can "extend the sphere" of freedom and prosperity.

AI and Finance: A New Era of Market Innovation

For our part, America's financial leadership depends on charting the future, rather than fearing it. Just as blockchain is reshaping how we trade and settle assets, artificial intelligence (AI) is opening the door to agentic finance-a system whereby autonomous AI agents execute trades, allocate capital, and manage risk at speeds no human can match, with securities law compliance embedded in its code.

The benefits could be immense: faster markets, lower costs, and broader access to strategies once reserved for Wall Street's largest firms. By coupling AI with blockchains, we could empower individuals, strengthen competition, and unlock new prosperity.

The government's responsibility here is to ensure that commonsense guardrails are in place while eliminating the regulatory obstructions that stifle innovation. AI is now part of our capital markets, and its role will only grow. We must resist the temptation to overreact out of fear. On-chain capital markets and agentic finance are on the horizon, and the world is watching. The choice before us is simple yet profound: either America steps forward with confidence and conviction, or others will. I choose leadership, freedom, and growth-for our markets, for our economy, and for the next generation. And I am eager to work with international counterparts who are interested in joining us in this pursuit for a more prosperous and free society.

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In closing, with your partnership, we can shape future regulatory initiatives so that they fulfill their intended function of protecting investors while preserving plentiful room for innovators and entrepreneurs to thrive. As I stated earlier, it is a new day at the SEC as we realign the agency's enduring principles with emergent possibilities. I am confident that international cooperation in the regulatory matters I have discussed will benefit all of us in the long run, across the United States and around the globe. And I look forward to engaging in this work together, with the resolve worthy of the opportunities before us.

For now, I want to thank you for your time and attention. You have been a patient and indulgent audience. And you have my best wishes for a wonderful remainder of your roundtable.

Merçi, Mesdames et Messieurs, de votre attention et je vous souhaite un bon après-midi.