The corporate regulator has announced plans to build consumer trust in financial advice by focusing on recruitment and remuneration practices within the industry.
In its corporate plan for 2017-18 to 2020-21, ASIC outlined a number of projects designed to align “conduct in a market-based system with investor and consumer trust and confidence”, focusing on behaviour that poses the greatest risk to consumer confidence.
“In this year’s corporate plan, we highlight the need to keep building people’s financial capability to support them in planning for their future; for gatekeepers, culture, incentives and deterrence continue to be factors driving behaviours in the sectors we regulate,” the plan said.
“Gatekeepers play a critical role in managing these challenges and the overall health of the financial system. Their conduct – at the firm and industry level – affects investor and consumer trust and confidence.”
Remuneration, recruitment, training and whistleblowing policies will all be focal points for ASIC’s surveillance activity into financial advice over the coming four years, with gatekeeper competence, governance and disclosure practices all being considered as well.
In the financial advice space, ASIC will continue with its surveillance into compliance within the “big five financial advice firms” and remediation programs of fee-for-no-service breaches, and will commence a new project examining the effectiveness of life insurance remuneration reforms.
ASIC has also listed a number of projects focusing on markets, including a new project on compliance with continuous disclosure obligations, and implementing standards for listing complex exchange-traded products.
The company is looking to expand its services for financial advisers.
The FPA has developed a new SOA video toolkit to guide members.
“All advice should be regulated in a similar way”, a financial services firm has argued in its QAR submission.
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