Diplock will continue to chair the New Zealand Commission during her two-year term with IOSCO.
The day-to-day work of IOSCO is based in Madrid.
"It is a very great honour for New Zealand to be recognised at such an important level," Diplock said.
She said it was an affirmation of the development of New Zealand's own regulatory framework in line with international best practices.
"It gives us the opportunity to play a central role in the ongoing work of IOSCO."
IOSCO has a membership of over 100 jurisdictions around the world and is recognised as the international standard setter for securities regulation.
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