FINSIA’s first response to Royal Commission

Chris Whitehead

Chris Whitehead

FINSIA CEO Chris Whitehead said “While it will be some time for all the ramifications of the Royal Commission recommendations to filter through, FINSIA is committed to helping implement reform in a timely and effective manner.

“It is clear he has concluded the core issues are:

  • Cultural reform
  • Stronger enforcement
  • Eliminating conflicted remuneration models

“We recognise there will be significant changes in the way banks and financial services operate.

“Many of Commissioner Hayne’s recommendations highlighted how financial advice, mortgage broking, superannuation and banking as a whole needed to change.

“While he wasn’t as trenchant as in his interim report where he talked about short terms sales targets being driven by greed, he did conclude that there is a choice between being a salesperson or a professional – you cannot be both.

“I am certain I know where FINSIA members stand on that one, which is why we have the tools in the professional qualifications, CPD and a focus on instilling pride in individuals.

“Taking that further, we think it’s better to commit to do the right thing for customers – not just what’s legal.

“And while we will have to await the outcomes of Commissioner Hayne’s referrals to APRA and ASIC for legal action on misconduct, the government’s response to the in-depth inquiry has inone respect gone further.

“In its response, the government says it supports and encourages industry to develop voluntary codes that “go beyond the requirements in the law” and recognises the role for  “voluntary codes in harnessing the views and collective will of industry”. This in line with FINSIA’s philosophy – that we need industry wide action on individual standards as well institutional conduct reflected in the Banking Code of Practice.

“Moreover, when the government says it “is committed to the professionalisation of the financial advice industry” it is what we have been saying for the past 20 months.

“So we look forward to continue working with the all the key stakeholders across the industry.

“The commitment to professional excellence commenced by our founders 133 years ago – is ongoing and just as focused.”

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