The Financial Advice Association Australia (FAAA) has raised concerns that the cost of implementing a data publication project would be passed on to advisers.
Last month, the Australian Securities and Investments Commission (ASIC) released a consultation paper on its plans to publish two dashboards containing reportable situations and internal dispute resolution (IDR) data in the second half of 2025.
This would see firm-level data go public, ASIC stated, including businesses’ names and Australian Financial Services Licence (AFSL) numbers.
In its submission to ASIC’s consultation on the proposal, the FAAA said there needs to be greater disclosure of both the initial and ongoing costs of the project.
“Given the proposed data publication project covers a large percentage of ASIC’s regulated population, and such costs will likely be recovered via ASIC’s Industry Funding Levy, it would be reasonable for the estimated costs of this project to be released as part of the consultation process,” the FAAA said.
It added: “Any spend on this functionality should be cognisant of the value that it will generate for users, and this is not particularly evident to us at this stage.”
The association also argued that the actual approach the regulator plans to use is “extremely unclear” and, without greater detail, the data publication project is not ready for implementation.
“In the absence of an example that clearly demonstrates how the data will be presented, it is extremely difficult to appreciate what is being proposed,” the submission said.
“We recommend ASIC consider conducting roundtables with industry and potential end users with demonstrations of ‘mock’ publications, to seek further input to ensure the final product meets the needs of end users.
“Consumer needs and understanding must be the focus of any public-facing data publication; however it is unclear to us who ASIC considers as the target audience and what their information needs are.
“Consideration must also be given to how people without a financial services compliance background, including the media, may interpret and use this information.”
According to ASIC, when it released the consultation paper, the publication of the dashboards aims to boost transparency, drive improved performance and help deliver better consumer outcomes.
“Publishing reportable situations and internal dispute resolution data will encourage firms to lift their game,” ASIC commissioner Alan Kirkland said at the time.
“It also provides consumers and investors access to this data at firm level, further encouraging confident and informed participation in the financial system.”
However, according to the FAAA, it is unclear who exactly the data publication is actually targeting.
“CP383 suggests the publication will assist licensees to identify areas where substantial numbers of significant breaches and IDR complaints are occurring and allow firms to target their efforts to improve their compliance and consumer outcomes in those areas,” it said.
“This ignores the fact that firms already have this data as it is information each firm is legally obliged to collect and provide to ASIC.”
It also cast doubt on whether publication of this data would indeed enhance accountability and transparency, noting that the regulator has the data for “oversight purposes” whether it publishes it or not, and this should be enough to incentivise firms to improve in “any areas that may be lacking”.
“Equally, it ignores the complexity of the RS reporting regime and the issues with the IDR complaint thresholds, which create significant variability in the data collected by firms and confusion around the obligations, and arguably discourages compliance,” the FAAA said.
“The FAAA recommend that licensees should not be the targeted end users of the data publication; and that the publication should not be used as a ‘name-and-shame’ tool to ‘incentivise good behaviour’.
“This approach will likely just disadvantage firms that are doing the right thing.”
