SRO (self-regulatory organization) is a voluntary non-profit association of legal entities in order to regulate the range of issues related to a particular industry or profession. She can deal with issues whose solution is not fixed by law, as well as supplement state regulation. The ability of an SRO to exercise regulatory functions often arises from the authority given to it by the government.
The main goal for which SROs are created is to minimize state participation in the professional activities of organizations and at the same time create a body that monitors the quality of their work. The responsibility of producers to consumers is the main tenet of the SRO. What are product quality standards, and why they must be respected, far from all market participants understand. Therefore, self-regulatory organizations often establish their own rules for standardization and certification of products aimed at improving the competitiveness of all players in their industry.
Historical reference
There are many SROs operating in the USA. What is an American self-regulatory organization, and how exactly does it work, can be explained with a concrete example. The U.S. main federal regulator, the Securities and Exchange Commission (SEC), decided to delegate part of its authority to change industry standards for the Securities Dealers Association (NASD) and the American Stock Exchanges (NYSE). After they implemented the requirements related to changing the procedure for working with securities and the rules for the provision of brokerage services, NASD and NYSE - by merger - were transformed into a new SRO. FINRA today has broader financial regulatory functions.
Self-regulatory organizations in Russia
The history of Russian organizations begins in 1995, when the first law on SROs was adopted. What self-regulatory organizations are, what tasks they have to solve, in those transitional conditions it was unclear. The introduction of the self-regulation institute was supposed to streamline the activities of housing cooperatives, investment and pension funds, arbitration managers, as well as regulate the work on the securities market.
Today in the Russian Federation there are more than 1 thousand self-regulating organizations operating in 26 professional sectors. The construction and energy industries are leaders in their number. The country has 445 self-regulatory organizations of builders and designers. SROs in the field of energy audit are represented by 133 organizations.
Self-regulatory building organizations
Self-regulation in construction dates back to 2009, in which the institution of state licensing of the construction business was canceled. The creation of an SRO of builders was legislatively prescribed in the field of:
• preparation of design estimates;
• engineering surveys;
• construction.
The builders appreciated the innovation and began en masse to register their membership in the SRO. What is the association of builders will help the industry quickly recover from the crisis, it was immediately clear. Indeed, within 2 years, the volume of construction returned to the pre-crisis level, and the creation by the SRO forces of the ESTP tender site for builders solved the problem of timely distribution of orders.