As Australia’s population ages, the demand for aged care advice will inevitably surge.

Data from the Australian Institute of Health and Welfare (AIHW) shows that Australia’s population aged 65 and over is projected to reach 22% – or 8.8 million people – by 2057, reinforcing the need for specialist aged care advice. This article, proudly sponsored by GSFM, explores some of the issues around ethics and providing financial advice to ageing Australians.

Australia is an ageing nation. One in five Australians are aged 65 and over^[1]. That does not include the tail end of the ‘baby boomers’, nor Gen X snapping on their heels. The percentage of the population aged 65 and over has increased from 12% at 30 June 1994 to 17% 30 June 2024^[2].

Driven by improved nutrition, medical advancements and healthier lifestyles, Australian life expectancy now extends well into the 80s, underscoring a critical need for structured aged care advice. However, while post-retirement financial planning traditionally prioritises wealth decumulation and immediate lifestyle funding, long-term aged care strategies remain significantly underemphasised.

The aged care system is a complex web of providers, agencies and changing regulations that often overwhelms families during a period of high vulnerability. This makes access to accurate, conflict-free professional advice vital to safeguarding the best interests of older Australians.

The inherent complexity of the Australian aged care system has been amplified by the introduction of the Aged Care Act 2024 and its funding reforms that came into effect on 1 November 2025. In the wake of these reforms, Australians will increasingly rely on personalised guidance to make informed decisions tailored to their unique family circumstances. Professional support will be essential in helping Australians navigate their aged care funding options effectively.^[3]

Aged care in Australia

While the aged care system is designed to support older Australians, it remains riddled with complexities and is challenging for families to navigate. These complexities make it difficult to both access the required support and understand the financial intricacies of that support.

There are two main pathways in the system, at-home support and residential aged care, funded by a mix of government support and personal contributions. However, it’s not as simple as making an application – the federal government’s own report, released the same day as the federal budget, revealed that it takes, on average, 12 months to get a spot in an aged care home or secure at-home support^[4].

Further, senate estimates figures show that in December 2025, there were more than 230,000 Australians currently on the wait list for aged care, either for an assessment or a package at their approved level.

Care in the home – designed to help older Australians stay independent for longer, the Support at Home program (formerly In-Home Care program) provides a coordinated care plan tailored to meet the recipient’s specific needs. While it sounds great in theory, the application process is onerous and there’s a substantial waiting list for both assessment and allocation of a package.

Care in a residential aged care facility – this provides accommodation, daily care and lifestyle services within an aged care home. This can be a permanent move or a short-term stay (respite care). Permanent care is intended for those who can no longer live at home due to increased care needs.

As most aged care advice focuses on access to and funding residential aged care, in-home support services are not discussed further in this article.

A major reason people access aged care advice is the complexity of the fee structures associated with residential aged care. The following provides a brief overview of the fee structure, which – like many government programs – is subject to regular review and change. Major changes were implemented as part of the Aged Care Act 2024. The same fee structure is applicable whether the aged care facility is run by local or state government, a charitable organisation or corporate.

Aged care fees and the Aged Care Act 2024

The overhaul of residential aged care fees in the Aged Care Act 2024 represented a significant structural shift. The rationale for these changes stems directly from the recommendations of the Royal Commission into Aged Care Quality and Safety and the findings of the Aged Care Taskforce. The core objective was to create a dual-benefit solution: protecting the financial dignity of older Australians while ensuring the entire aged care sector does not collapse under escalating costs^[5].

The major change to aged care fees introduced by the 2024 Act is drawing a line between what the government should pay for and what the individual should pay for.

The Act established that health and clinical care is a universal right. Therefore, the government funds 100 percent of clinical care, which includes nursing, medical management and allied health.

However, everyday living and accommodation costs are co-contributed; the rationale is that whether you live in your own home or a residential facility, you still have to pay for food, laundry, utilities and rent.

So, under the new act, the former ‘Means Tested Care Fee’ has been split into two distinct, means-tested categories:

• The hotelling contribution – a co-contribution to daily lifestyle and facility operational costs, capped at $22.15 per day
• The non-clinical care contribution – this covers personal care, such as showering, dressing and leisure activities, capped at $107.32 per day.

A significant change is the introduction of measures to inject capital directly into the infrastructure of aged care homes:

• RAD retention – aged care providers are now permitted to retain a small portion of a resident’s Refundable Accommodation Deposit (RAD). Providers can retain two percent per year for up to five years, a total maximum of 10 percent of the RAD. Given many RADs are over one million dollars, this can represent a sizable amount. This only applies to people entering aged care from 1 November 2025.
• Increased price caps – the maximum room price cap was raised from $550,000 to approximately $750,000 and indexed to inflation. This is the maximum price a provider can charge without seeking approval from the Pricing Authority.

The Act also introduced the ‘no worse off’ principle; anyone who was already in residential care prior to 12 September 2024 is strictly grandfathered. Their contribution arrangements stay exactly the same. As with any change, there are a lot of caveats around the new payments, and which payment applies to what person – this only adds to the already complex structures.

What are the costs?

The following is a summary of the primary aged care fees – specifically, the cost of the room. The reality involves far more complexity and will vary from client to client. This illustrates the importance of personal finance advice when it comes to accessing aged care services.

Prior to moving into a residential aged care home, the resident must agree on a room price with the provider. It’s important to note that prices will vary from one provider to the next. Whether an individual qualifies for government assistance to cover these accommodation costs, in full or in part, is determined by a formal means assessment.

There are three options for payment.

A refundable lump sum (RAD or RAC)

There are 2 types of lump sum, depending on the outcome of your client’s means assessment:

• Refundable accommodation deposit (RAD): This is when your client pays the full amount and is the accommodation price agreed with the provider.
• Refundable accommodation contribution (RAC): This is when the government helps with the costs and is worked out by the provider based on the daily accommodation contribution (DAC).

It is important to know that a refundable lump sum is counted as an asset in the aged care means assessment, even in the event it is paid by a family member. This means that paying a lump sum can affect overall fees charged by the provider.

A daily payment (DAP or DAC)

There are two types of daily payments, depending on the outcome of the client’s means assessment:

• Daily accommodation payment (DAP): this is when your client pays the full amount themselves and is the accommodation price agreed with your provider. Daily accommodation payments are indexed on 20 March and 20 September each year.
• Daily accommodation contribution (DAC): this is when the government helps with the costs; the amount is determined by Services Australia based on the client’s means assessment.

Daily payments are akin to rent payments and are not refunded when your client leaves care.

A combination of refundable lump sum and daily payments

This is when your client combines the two types of payments to meet their costs. The split of the combination can be made in the way that works best for the client’s financial situation.

The financial commitment of residential aged care extends beyond the initial room price. Once a resident moves in, they face ongoing daily fees for accommodation, care and hospitality services. Under the reforms that rolled out from 1 November 2025, the government restructured these fees to increase transparency. At the same time, a stronger user-pays model was introduced, one that scales based on an individual’s personal wealth.

The government’s website My Aged Care provides more information about aged care costs and how they are calculated.

Aged care advice

Access to quality aged care financial advice is incredibly important when it comes to making well-informed aged care decisions. Clients – and often, their families – need to understand the complexities of fees and costs and how to best structure finances to afford the required care.

However, there’s an ongoing problem with aged care advice, one beyond the inherent complexities in accessing and paying for care.

It’s an issue for the broader advice industry as well as extremely challenging for the clients and their families. The issue is this: a substantial amount of ‘aged care advice’ is provided by individuals who are unlicensed, not authorised, not on ASIC’s Financial Adviser Register. It’s provided by a range of people, professionals such as lawyers or accountants, individuals working in the aged care sector or with ancillary services. In some cases, aged care advice is provided by former (i.e. deregistered) financial advisers.

It can be difficult for families to source the right help and to understand the differences in the advice on offer. Are they receiving information only, general advice or comprehensive personal advice?

 Information versus advice

In many cases, the ‘client’ is the family of the person entering aged care and the move is often event driven. As the event is often negative – an illness, a fall, the death of a partner – emotions and stress levels can run high.

It is not unusual that the seekers of advice often don’t have the luxury of time or the emotional clarity to check the credentials of someone offering aged care advice, let alone ensure the guidance provided is in their loved one’s best interests.

Of course, there’s a lot of information that can be imparted without crossing the line into advice. This includes:

• explaining aged care fees (including calculations for an individual’s fee scenario)
• explaining Centrelink entitlements
• sourcing appropriate temporary or permanent accommodation.

If the professional in question is simply providing information without affecting any decision making, it’s not advice.

However, once the provider of aged care information influences an action, this likely crosses the line into personal advice. This might include:

• discussing options about how the client could pay for the aged care fees, or
• making recommendations about payment options.

However, even where a recommendation isn’t made, simply influencing the client to decide about a specific option, product or product class falls into the realm of personal product advice. The Corporations Act 2001 outlines two steps to determine whether a person is providing personal product advice:

1. The person providing the information or advice knows personal information about the client
2. There is a suggestion or inference to make a change in respect to assets or products, or a class of products, and influencing the client’s decision about those assets.

Finding and funding accommodation is usually only the first step in holistic personal financial advice; there is often financial, tax, social security and estate planning considerations. These should be the purview of a registered financial adviser providing aged care advice.

For many consumers, the difference between information and advice is not clear. Decisions can be made in haste when those making them are emotional or vulnerable. Given the expenses associated with aged care, decisions about the advice may be driven by cost without understanding the implications of following a recommended course of action.

Unregistered advisers may be cheaper because:

• they don’t have applicable professional indemnity insurance
• they aren’t members of AFCA, thereby denying their clients an opportunity for redress
• they aren’t required to have memberships of professional associations
• they avoid ongoing educational requirements.

Importantly, an unregistered adviser is not bound by the Financial Planners and Advisers Code of Ethics (Code of Ethics).

Ethics and aged care advice

A registered financial adviser offering aged care advice is obliged to adhere to the Financial Planners and Advisers Code of Ethics (figure two).

The Code of Ethics was introduced to provide a layer of consumer protection and engender trust in the financial advice profession. The Code of Ethics requires financial advisers to meet their obligations in the law in respect of the advice provided to each client, including:

• The best interests duty
• The appropriateness of advice
• Prioritisation of client’s interests
• Additional requirements for product replacement recommendations
• Australian Taxation laws.

Further, licensed financial advisers are required to:

• Know your client
• Work out their situation, objectives, needs and their financial literacy level
• Have a reasonable basis for advice
• Know your product and the consequences of your advice, and ensure the advice is appropriate for the client
• Comply with statement of advice (SOA) requirements.

Those individuals who provide aged care advice (not just information) and are not registered advisers operate outside of this Code and the requirements outlined above. This has negative implications for consumers.

At best, unlicensed aged care advice can have mediocre client outcomes. At its worst, it can lead to elder abuse, in particular financial elder abuse. This is defined by the World Health Organisation as “The illegal or improper exploitation or use of funds or other resources of the older person” and is the subject of an earlier article in this year’s Ethics Series, Ethical financial advice for vulnerable clients – part two.

Registered financial advisers who provide aged care advice are licensed and regulated under the Corporations Act. Among other protections, their clients can take complaints to the Australian Financial Complaints Authority (AFCA).

Unregistered aged care advice is both a consumer protection and ethical issue for the industry. Although some clients receive personal product advice, they are not eligible for the protections available to clients of registered financial advisers, including access to AFCA.

Although not beholden to the Code of Ethics, unregistered advisers providing aged care advice fail to deliver important outcomes for clients that can be unpacked in reference to the Code and its standards, as follows:

The lack of mandatory registration for aged care advisers raises significant consumer protection concerns, as it leaves the sector without a formal mechanism to verify qualifications and expertise. This regulatory void exposes vulnerable families to advisers who may lack the necessary training to navigate complex aged care needs. Consequently, consumers face an increased risk of receiving inadequate financial planning and securing unsuitable care arrangements.

Furthermore, exempting these advisers from the Code of Ethics removes critical safeguards that mandate transparency, conflict management and acting in the client’s best interests. Without these binding ethical standards, accountability is severely diminished, creating an environment where advisers might prioritise personal or institutional gains over client welfare. This absence of oversight significantly heightens the risk of biased, misleading or self-serving financial advice.

Finally, the intricate and constantly changing nature of the aged care system demands highly specialised knowledge, particularly regarding its interplay with financial planning. Without robust regulatory and ethical frameworks, consumers are uniquely vulnerable to outdated or inaccurate advice that fails to address their specific needs. Ultimately, this lack of oversight undermines public confidence and can lead to severe, long-lasting financial and emotional repercussions for families.

Case studies

The following case studies highlight the benefits of obtaining aged care advice from registered financial advisers through the lens of the standards comprising the Code of Ethics.

Case study one: Moving into aged care

Barry and Maureen, a couple in their early 80s, needed to arrange residential aged care for Barry due to his deteriorating cognition. Following a formal dementia diagnosis, Maureen and their children realised he needed professional care. Seeking guidance, they turned to an aged care adviser recommended by their neighbour. They were unaware that the recommended adviser was not a registered financial adviser.

The adviser, Nigel, provided Maureen with a detailed costing of the aged care options for Barry and suggested they sell the couple’s residence to pay for the Refundable Accommodation Deposit. They could then use the remainder of the sale proceeds plus their savings to buy a small unit for Maureen. While advice about buying or selling property, including the family home, is exempt from AFS provisions, the advice pertaining to the use of the couple’s savings is not.

However, Maureen was unhappy with the advice. She didn’t want to move; the couple had already downsized from their farm and moved into town – where else could she go? She was close to two of her three children, comfortable in her community and president of the local CWA. The downsized home was selected for its garden, and she didn’t want to have to give that up.

Encouraged by their children, Maureen and Barry sought a second opinion, this time from a registered financial adviser from ACME Aged Care Advice. Their new adviser, Jackie, explained that as clients of a registered financial adviser, they had a range of protections – and she had training and education related to the aged care sector. Further, she regularly undertook professional development to ensure she was familiar with current legislation and other changes to the sector.

Jackie helped the family understand the intricacies of the aged care fees they would incur and explain how they had changed post 1 November 2025. While the family had some understanding, what they understood to be the likely fees had changed. Jackie developed a strategy to ensure the family home would be retained, so Maureen could continue to enjoy her home, garden and community. Importantly, it ensured she had somewhere to live once Barry moved into aged care.

Jackie was able to recommend several strategies to rearrange the couple’s investments. She presented two funding options to determine which worked best for them. With tailored advice and support, the couple was able to fund Barry’s aged care needs and implement a financial plan that both prioritised their long-term wellbeing and considered all elements of their financial situation, including Centrelink entitlements and estate planning.

As a registered financial adviser, Jackie is bound by the Code of Ethics. Her conduct in this case study saw her meet her requirements under the Code, specifically in relation to the following standards:

Case study two: Meeting aged care needs

Evelyn, a 79-year-old widow living alone, suffered a severe stroke that left her with permanent mobility challenges. Following an extended stay in an acute stroke unit, her multidisciplinary medical team advised her two sons that returning home independently was no longer safe, recommending a transition into permanent residential aged care instead.

Evelyn’s sons, who acted as her joint Powers of Attorney – one managing her medical decisions and the other overseeing her financial affairs – promptly scheduled a meeting with David, Evelyn’s long-standing financial adviser. Recognising that aged care involves highly complex, specialised regulatory frameworks, David immediately brought his colleague Sarah into the consultation. While both operated under the same financial services licensee, Sarah had completed advanced postgraduate certifications in aged care financial strategies to navigate the intricacies of means testing, payment options and the impact on Centrelink benefits.

Working collaboratively, Sarah and David modelled several funding scenarios for the brothers. A core constraint was Evelyn’s deep sentimental attachment to her family home; she refused to sell it, and her sons noted the property required significant deferred maintenance before it could fetch an acceptable market price anyway.

To solve this, Sarah proposed funding the transition via a Daily Accommodation Payment (DAP) instead of a lump-sum Refundable Accommodation Deposit (RAD). David then restructured Evelyn’s existing investment portfolio to generate a predictable, tax-effective monthly income stream dedicated entirely to covering the DAP and ongoing care fees. Ultimately, the coordinated approach ensured the brothers fully understood the financial commitments, fee structures and cash flow mechanics required to secure their mother’s quality of care without selling her home.

Working together, Sarah and David were able to provide Evelyn and her sons with positive outcomes, which ensured Evelyn’s care needs were met and her financial security assured. Their conduct in this case study saw the advisers meet Evelyn’s requirements under the Code of Ethics, specifically in relation to the following standards:

As Australia’s population ages, the demand for aged care advice will inevitably surge. Navigating this system often requires rapid decision-making during a highly stressful family crisis, making access to reliable, expert guidance more critical than ever.

However, the current regulatory ‘grey area’ allows unregistered, unregulated individuals to provide aged care advice while remaining exempt from the Code of Ethics. This lack of oversight poses severe risks to consumers, leaving them vulnerable to unqualified operators and biased recommendations that can jeopardise both their financial security and peace of mind. To safeguard vulnerable families, policymakers and industry stakeholders must close these loopholes and mandate that aged care advice be delivered exclusively by registered financial advisers.

Partnering with a specialist aged care financial adviser, either through a trusted external referral network or as an embedded specialist within the practice, can protect and enhance an advice firm’s client base as the wealth transition accelerates.

By integrating this specialised expertise, practices can seamlessly guide multi-generational families through highly stressful care transitions, preventing costly financial mistakes and securing the broader family’s loyalty. Ultimately, a proactive approach transforms a looming operational challenge into a powerful retention tool, positioning the practice as a holistic, indispensable partner for ageing clients and their beneficiaries.

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Notes:
[1] National Ageing Research Institute demographic briefing
[2] https://www.aihw.gov.au/reports/australias-welfare/profile-of-australias-population
[3] The Risk of Unregulated Aged Care Advice: Protecting Older Australians and Ensuring Quality Advice, Aged Care Steps, January 2026
[4] Aged Care Act 2024 Wait Times Report: Residential care and Support at Home 1 November 2025 – 31 March 2026, published 12 May 2026
[5] https://www.agedcarequality.gov.au/providers/reform-changes-providers/about-new-aged-care-act-and-key-changes-providers

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For advisers, AI is rapidly moving from an experimentation phase to core advice infrastructure, and regulators are making it clear that governance expectations must keep pace.

Regulator scrutiny of AI governance just got serious

In years to come, they may well call it the ‘Mythos effect’ – the point in early 2026 where all the concerns about AI use in financial services came to a head and prompted the regulators to get serious.

ASIC has been watching this issue particularly closely since October 2024, when it published Report 798^[1], an examination of AI governance practices across financial services licensees. But when Anthropic (the company behind ‘Claude’) began inviting selected organisations to trial Mythos^[2] – a model built specifically for cybersecurity and autonomous coding – regulator anxiety shifted to a whole new level. Within weeks, ASIC had issued an urgent call^[3] for cyber uplift in the face of agentic AI, and APRA had written^[4] to all regulated entities demanding a ‘step change’ in AI risk management, warning that governance practices were falling dangerously behind the pace of advancements.

For advisers, the rapid adoption of AI gives this scrutiny extra relevance. A recent survey^[5] found that 74% of Australian advisers are already using or planning to use AI in their business – well ahead of the global average of 64% – with practices already putting AI to work drafting file notes, generating statements of advice and client communications, and accelerating research and compliance tasks.

For readers, this article takes a timely and practical look the nature of AI risks, the extent to which existing compliance frameworks and obligations acknowledge these risks, and what you can do now to close the governance gap and protect yourself and your clients.

AI is rapidly becoming advicetech infrastructure

The increasing adoption of AI by advisers has seen it rapidly progress from being an add-on tool to becoming a central element underpinning the technology stacks of advice practices.

The 2025 Adviser Landscape Report^[6] identified the key areas practices were already applying AI:

• 86% were using it for file notes and meeting documentation
• 53% were using it for client engagement applications such as newsletters
• 48% were using it for marketing, and
• 46% were using it with SOA or ROA production.

Given these rates are based on 2025 data, they are almost certainly higher now, as is the number of AI systems being used by advisers.

AI no longer just means ‘ChatGPT’, as advisers are presented with an ever-growing choice of generative AI tools developed specifically for advice, including Paradino, Saturn, and Marloo. At the same time, platforms and CRMs including Iress XPlan and Netwealth are rushing to offer various degrees of AI functionality, while the ubiquitous Microsoft 365 platform includes the rapidly improving Copilot.

The more innovative firms within the advice ecosystem are already pushing into more sophisticated territory. Melbourne-based Yarra Lane, working with outsourcing specialist Vital Business Partners, has been running AI-assisted workflow automation that literally goes to work overnight: bots review adviser calendars, access client systems, download portfolio reports and stage everything in SharePoint so advisers are ready to go before the first meeting of the day. As CEO Nick Perrett summed up, “our planners are working throughout the day, and our bots go to work at night.”^[7]

The next evolution will be ‘agentic AI’ – systems capable not just of automating fixed tasks, but of reasoning, making decisions and adapting when circumstances change, all without constant human direction. While still in its nascency within advice, the lightning pace of change, and the enthusiasm many advisers have for new technology, will likely drive a very sharp adoption curve.

But its power creates governance challenges

The power of AI to transform financial advice is already beyond doubt. Terry Dillon, Chief Executive of Shadforth Financial, expects his advisers to see 50 per cent-plus more clients thanks to AI, without dropping the amount of client contact or the quality of the advice.

“We’re not talking incremental change. We’re talking a step change in the number of clients advisers will be able to see over time,” Dillon says^[8].

As well as speed, AI can be consistent at scale, reducing the variability that can occur across different staff members or even across different decisions by the same team member.

Entireti’s Neil Younger argues this consistency “means you’re starting to introduce advice at lower cost points than we see in the traditional model.”^[9]

But this scalability and power is a double-edged sword. Any flaw in the AI, whether it be a hallucination, an algorithmic bias, or inadequate personalisation, can be propagated across hundreds of client files before anyone realises.

And the unseen nature of some AI tools – which run in the background of more comprehensive systems, rather than being standalone – can amplify the governance challenges.

ASIC’s central finding from REP 798^[10] is that these risks are real and growing, and businesses are struggling to ensure their governance practices can keep up with the explosive pace of change.

What ASIC found in Rep 798

ASIC’s Report 798 was based on a review of 624 AI use cases across 23 licensees, including banks, credit providers, insurers and financial advice businesses. What they found was that governance frameworks put in place by many of these businesses were failing to evolve at the same speed as the technology.

More alarming was the observed variability in standards – while some licensees had documented strategies and board-level reporting, others had no AI specific policies or governance framework at all.  Among the specific findings:

• Only 12 of the 23 licensees had policies addressing fairness or bias in their AI systems
• Only 10 had any documented approach to disclosing AI use to consumers
• None had implemented ‘contestability’ arrangements (mechanisms allowing clients to challenge decisions in which AI had played a role)
• 30% of all use cases relied on third-party AI models, and many licensees could not explain what those models were actually doing.

ASIC illustrated the practical implications of these governance shortcomings with a powerful, real life case study : a credit scoring model that had been running for months with no governance documentation, no risk rating and where the provider “could not explain the variables in the scorecard or the impact they are having on an applicant’s score.”^[11]

It is easy to imagine the same sort of ‘black box’ scenario in risk profiling software, which, if some unknown error or bias crept in, could allocate erroneous risk profiles to clients, undetected, for a significant period of time, potentially opening those clients up to significant financial harm.

Cyber risks take centre stage

While AI related cyber risks received little focus in Rep 798 (being mentioned only twice), the ‘Mythos effect’ has seen the topic become much more prominent in ASIC’s recent thinking, culminating in their May 2026 call for ‘cyber uplift’.

In an open letter^[12] from Commissioner Simone Constant, ASIC noted:

“The rapid evolution of frontier artificial intelligence models marks a significant shift in the cyber threat landscape. These models are accelerating both capability and accessibility, lowering the barrier to sophisticated cyber activity, increasing the speed and scale of attacks, and enabling new forms of exploitation that were previously out of reach for most actors.”

“This is not a distant or hypothetical risk. It is here now, evolving quickly and requires the attention of boards and executives.”

While ASIC weren’t targeting one specific industry sector with this message, the sensitive nature of client data stored and used by financial advisers makes advice firms an attractive target for ‘bad actors’, giving this statement added resonance for the advice profession.

In particular, it forces AFSLs to reckon with a problem not previously factored into most AI governance thinking – the extent to which AI dramatically expands the “attack surfaces” (exposure to untrusted networks).

When client data is fed into third-party AI tools, for example to generate file notes, draft SOAs, or summarise meeting transcripts, it is leaving the firm’s ‘controlled’ environment. The data handling practices of the AI vendor and the security of the API connection become a critical part of the firm’s cyber risk profile. The more vendors used, the bigger the attack surface.

APRA puts all regulated entities on notice

During a targeted review of large banks, insurers and superannuation trustees in late 2025, APRA identified a number of gaps which echoed those uncovered in Rep 798, including cyber security, governance maturity, and third-party concentration.

Following their review, APRA wrote to all regulated entities in April 2026 warning that while AI adoption is accelerating across the sector, associated governance and risk management practices are not keeping up^[13]. Boards were singled out as needing to develop the ability to challenge AI-related risks and ask hard questions of management.

AI governance – advisers’ existing obligations

ASIC frequently makes the point that the law, and its associated guidance, is ‘technology neutral’. This makes it easier for the regulatory framework to adapt to unforeseen technological advancements (video SOAs anyone?), and also means advisers have a base level of compliance obligations that apply regardless of the technologies used.

Key examples of obligations that are directly relevant to the use of AI in advice include (but are not limited to):

• Providing services “Efficiently, honestly and fairly” (under s912A)
  • You can’t blame an AI tool for incorrect outputs
• Not making “False and misleading representations” (under Australian Consumer Law)
  • AI hallucinations remain a significant risk
• Best Interests Duty
  • Professional reasoning cannot be delegated to a model
• Record keeping
  • The same evidentiary standards apply to AI generated file notes as to human generated documents.

A practical adviser framework for AI governance

In addition to the foundational compliance obligations that apply regardless of the technology used, the governance questions included by ASIC in Report 798 are a valuable starting point when building a practical, AI specific, governance framework for advisers.

An example of such a framework is below:

• Do an AI inventory check
  It is crucial to understand where AI exists in your practice. Start with a simple inventory: every AI tool in use, what it does, who is accountable for it, and what client data it touches. Include tools embedded in CRMs and wealth platforms, not just standalone AI applications.

• Have a documented AI policy
  At some stage, it is likely that having a documented AI policy will be mandatory, so get ahead of the curve. Your policy should cover:

• • which AI tools are approved for use and for what purposes?
  • what AI tools are not permitted (particularly for client-facing outputs without human review)?
  • what data may and may not be input into AI tools?
  • what review is required before AI-generated content is relied upon or sent to clients?
  • what client information is being fed into AI tools?
  • who stores those prompts, and what are the privacy implications?

• Assign accountability
  Someone in the practice needs to own AI governance. In a small practice this may be the principal adviser. In a larger licensee it may require a formal role or committee. ASIC’s May 2026 cyber statement is explicit that this responsibility sits at board and leadership level.

• Conduct meaningful human oversight
  Having genuine human oversight of AI output – often referred to as ‘Human in the loop’ – means the adviser can stand behind every recommendation in the document, explain the reasoning, and confirm it reflects the specific client’s circumstances. Anything short of this means such oversight doesn’t really exist.
• Train your staff on the tools they use
  The black box phenomenon, where no one really understands how AI is generating the answers it does, is clearly dangerous. Staff need to understand what each AI tool does, what it can get wrong, and where their judgement needs to take over.
• Make your vendors accountable too
  Most AI powered software is provided by a third party, and you need to be comfortable about their own governance standards. Find out from the vendor what model they provide to you, how it is trained and updated, how errors are identified and corrected, and what happens to client data entered into the system. 

• Address cyber risk specifically
  ASIC’s May 2026 letter placed active management of third-party cyber risk squarely on the licensee. Review which AI tools are receiving client data and under what terms. Assess vendor security practices and data handling as part of your outsourcing governance.
• Tell your clients where you have used AI
  There is currently no mandatory requirement to disclose AI use to clients in the advice context. But Rep 798 flags this as an area of emerging expectation, and voluntary disclosure is now better practice. Consumers have a growing expectation that AI is used by businesses and indeed may even use AI to critique your recommendations. Providing a brief, plain-language explanation of where AI is used in the advice process can protect you and the client down the track.
• Build in regular reviews
  AI vendors can update models, add capabilities and change data handling practices at breathtaking speed. The governance framework you put in place today will likely date faster than almost any other document in your business, meaning regular reviews are critical.

In summary

For advisers, AI is rapidly moving from an experimentation phase to core advice infrastructure, and regulators are making it clear that governance expectations must keep pace. Recent interventions from APRA and ASIC – for which new ‘frontier’ and agentic AI systems were the catalyst – signal that improving AI oversight is something for entities of all sizes to prioritise now.

For advisers, the challenge is not whether AI should be used, but how it can be used in a way that remains defensible and consistent with existing professional obligations. Practices that treat AI governance as an extension of their broader compliance and client protection frameworks will be better positioned to capture the transformative benefits of the technology, while avoiding the governance failures regulators are increasingly worried about.

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ASIC Knowledge Requirements: Regulatory Environment (0.25 hrs)

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References:
[1] https://download.asic.gov.au/media/mtllqjo0/rep-798-published-29-october-2024.pdf
[2] https://www.abc.net.au/news/2026-04-23/powerful-ai-tools-posing-cybersecurity-risks-australia-lagging/106584436
[3] https://www.asic.gov.au/about-asic/news-centre/find-a-media-release/2026-releases/26-092mr-asic-calls-for-urgent-cyber-uplift-as-ai-accelerates-cyber-threats/
[4] https://www.apra.gov.au/news-and-publications/apra-calls-for-a-step-change-ai-related-risk-management-and-governance
[5] https://www.adviserratings.com.au/news/the-ai-revolution-in-financial-advice-australian-practices-leading-global-adoption/
[6] Ibid
[7] https://www.professionalplanner.com.au/2025/05/meet-the-advisers-pioneering-the-professions-ai-adoption/
[8] https://www.afr.com/companies/financial-services/the-biggest-constraint-to-using-ai-for-financial-advisers-20260407-p5zltj
[9] Ibid
[10] https://download.asic.gov.au/media/mtllqjo0/rep-798-published-29-october-2024.pdf
[11] Ibid
[12] https://download.asic.gov.au/media/xhrf1w0e/26-092mr-open-letter-to-afs-licensees-and-market-participants.pdf
[13] https://www.apra.gov.au/apra-letter-to-industry-on-artificial-intelligence-ai

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Aware Super scooped four wins in total, including the award for Best Fund: Member Services, and Best Fund: Insurance.

The Chant West Super Fund Awards celebrate excellence across 14 categories, showcasing industry best practice to help lift standards across the industry, celebrating the achievements of funds for their work in the important areas of investments, member services, advice and insurance. The awards also play an important role in encouraging ongoing improvement across the sector, with the ultimate goal of delivering better outcomes for members.

The other category winners were:

• Corporate Solutions Fund of the Year – Australian Retirement Trust
• Advised Product of the Year – AMP MyNorth
• Best Fund: Investments – Hostplus
• Best Fund: Advice Services – Brighter Super
• Best Fund: Lifetime Product – AMP MyNorth Lifetime, for the third year in a row
• Best Fund: Innovation – HUB24
• Best Fund: Responsible Investments – UniSuper
• Best Fund: MySuper Performance Outcomes – Hostplus
• Best Fund: Digital Advice – AMP Super
• Specialist Fund of the Year – Team Super

Chant West general manager Ian Fryer says after many years of having a bespoke theme for each year’s awards – which put the spotlight on a key priority or challenge within the industry – Chant West decided not to have a specific theme this year.

“We believe this decision allows each of the 14 categories to have their respective moment in the spotlight, and rightly focus on the individual criteria that underpins each award, without elevating one above another,” Fryer says.

“Highlighting excellence in all 14 categories is important if Australia’s super system is to continue to thrive.”

Fryer says Australia’s retirement saving system is regarded as one of the best in the world.

“The Chant West awards highlight the innovation and excellence at play in the sector, which will help ensure it continues to remain focused on delivering better retirement outcomes for all members.”

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Nathan Jacobsen

Principal advisers looking to build large, highly profitable businesses must choose between being a great adviser or a great chief executive officer because, at scale, they can’t be both, according to outsourcing specialists, Vital Business Partners (VBP).

In a new paper titled, From cottage industry to professional companies: VBP’s guide to scaling with confidence, the outsourcing firm claims that fast growing firms often encounter significant challenges, including declining earnings, in the initial stages of scaling up because they don’t have the resources and capability to manage the complexity that comes with running a larger business.

However, this trap is avoidable if founders can develop their leadership skills or bring in leaders with the right experience and skillset, the guide claims.

Nathan Jacobsen, VBP chief executive officer, said that businesses focused on accelerating growth through M&A and organic activity needed to remove principal dependency by having clearly defined roles and responsibilities, formal systems and processes for efficiently deliver advice, and a robust risk management framework.

“A declining EBITDA margin is not inevitable, demonstrated by at least some of the many thriving large advice businesses, but scaling a small-to-medium firms requires different choices and skills around operational efficiency, risk management, people leadership and strategy,” he said.

VBP’s guide provides insights into the process of scaling up, based on the group’s experience working with hundreds of advice firms. It aims to help principal advisers determine if that strategy is the right path for them.

Jacobsen, who is also chief operating officer of VBP’s parent company AZ NGA, said scaling up had the potential to deliver many benefits, such as operational and cost efficiencies, better access to capital, and a more structured approach to growth, but it was not for everyone.

“Building and running a successful business of scale requires a lot of hard work and significant ongoing investment in people, systems, processes and technology, which many people do not have the skill, experience or risk appetite to undertake,” he said.

For those that do, size has many advantages and we’re seeing a clear trend of businesses scaling, as heightened regulatory scrutiny and rising compliance costs put pressure on businesses to drive efficiencies and improved client outcomes.”

The VBP guide identifies and defines the two main types of advice businesses and the various challenges, opportunities and risks they face when it comes to scaling. It outlines key considerations for business owners before pursuing an aggressive growth strategy and provides a rough blueprint for scaling up.

Read the report.

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Fiduciary duty is more than a regulatory hurdle; it is the moral and professional backbone of a sustainable financial advice practice.

Today’s financial adviser stands as a true professional partner; a fiduciary whose primary purpose is to empower clients to achieve their life goals and financial objectives. This article, proudly sponsored by GSFM, examines the importance of fiduciary duty and ethics in the Australian financial advice practice.

Ethical financial advice is an essential aspect of ensuring the wellbeing and financial success of both individuals and businesses. Within this, fiduciary duty plays a crucial role in establishing trust, integrity and client-focused decision making.

As defined by the United Nations Principles of Responsible Investment (UN PRI), fiduciary duty exists to ensure that those who manage other people’s money act in the interests of beneficiaries, rather than serving their own interests. For financial professionals, fiduciary duty serves as a guiding principle that compels them to put their clients’ best interests first.

At its core, a fiduciary duty is a powerful commitment to partnership. It is the gold standard of professional relationships, ensuring that every recommendation, strategy and conversation is filtered through a single lens: the client’s best interest. This isn’t just about avoiding conflicts; it’s about the proactive pursuit of the best possible outcomes for those who entrust you with their futures.

Fiduciary duty defined

A fiduciary duty is a fundamental legal and ethical responsibility that financial advisers, investment professionals and others in the financial services industry owe to their clients – it’s a promise to put their clients first. For financial advisers, this means moving beyond basic compliance to act with absolute loyalty and transparency. It is a legal and ethical mandate to prioritise clients’ financial well-being above their own personal gain or profits for the practice or licensee.

To honour this duty, an adviser must:

• Apply expert judgment and due diligence to ensure every recommendation aligns with each client’s specific objectives, goals and risk tolerance
• Disclose any potential conflicts of interest so the advice clients receive is unbiased and free from hidden incentives
• Exercise sound judgment, due diligence and integrity when managing assets on behalf of their clients.

Ultimately, this duty is the cornerstone of the adviser-client relationship. By aligning directly with the twelve standards (figure one) that comprise the Financial Planner and Adviser Code of Ethics (Code of Ethics), the fiduciary standard transforms financial advice from a simple transaction into a trusted, long-term partnership built on accountability.

ASIC describes the best interests duty and related obligations as:

“…designed to ensure that retail clients receive advice that meets their objectives, financial situation and needs, and that you act in the best interests of your clients when providing advice.”

As it relates to financial advisers, this can be articulated as always acting in the client’s best interests, acting with competence, honesty, integrity and fairness…words that appear in the value statements that underpin the Code of Ethics.

In July 2013, the introduction of FOFA included an amendment to the Corporations Act 2001 that enshrined the best interests duty into law and extended the existing fiduciary duty financial advisers owe to clients.

This duty encompasses the know your client requirement, the obligation to understand recommended products and the mandate to keep the client’s interests central to all advice. Alongside these amendments, strict penalties for non-compliance were introduced, including banning and disqualification orders.

Section 961B of the Corporations Act 2001 (as amended) lists the actions advisers must undertake to satisfy the best interests standard. In summary, these are^[1]:

1. To identify the client’s financial situation, objectives and needs; these should be provided to the adviser by the client.
2. To identify the subject matter of the advice sought by the client (whether explicitly or implicitly).
3. To identify the client’s relevant circumstances – the objectives, financial situation and needs that would reasonably be considered as relevant to the advice sought on the identified subject matter (i.e. the client’s relevant circumstances).
4. To ensure this information is complete and correct, and to make reasonable enquiries if gaps or inconsistencies are apparent.
5. To assess whether you have the expertise required to provide the client advice on the subject matter sought and, if not, decline to provide the advice.
6. When considering the advice sought, whether it would be reasonable to consider recommending a financial product. If a financial product is deemed relevant, a recommendation should only be made after thoroughly investigating the most appropriate products relevant to the client’s circumstances.
7. When advising the client, the financial adviser must base all judgements on the client’s relevant circumstances.
8. Take any other step that, at the time the advice is provided, would reasonably be regarded as being in the best interests of the client, given the client’s relevant circumstances.

Number eight is a catch all statement that encapsulates the spirit of the legislation. Regardless of a client’s specific requests, all advice must be rooted in a deep understanding of their unique profile and circumstances. While the best interests duty is a formal requirement for retail clients, a comparable fiduciary standard governs professional conduct when dealing with wholesale clients.

A failure to act in a client’s best interests would not only breach section 961B of the Corporations Act 2001, but it would also breach several ethical standards, including:

ASIC notes that the best interests duty and related obligations are designed to ensure that retail clients receive advice that meets their objectives, financial situation and needs, and that you act in the best interests of your clients when providing advice.

ASIC’s Regulatory Guide 175 AFS licensing: Financial product advisers—Conduct and disclosure  (November 2024) contains guidance about:

• How the best interests duty applies to personal advice (both comprehensive and scaled advice)
• Features of good quality advice
• The ‘safe harbour’ provisions, defining how to comply with the best interests duty
• The modified best interests duty and when it applies
• Use of processes to provide advice
• How to recognise a possible conflict of interest, and
• The conflicts priority rule and how it applies to products or services provided by a related party.

A practical fiduciary framework

There are several practical measures your advice practice can implement to ensure your team consistently meets its fiduciary duties and ethical responsibilities as outlined in the Code of Ethics.  These include:

Transparency and disclosure

At its core, a fiduciary duty requires you to act with undivided loyalty to your clients. Transparency is the mechanism that makes this loyalty verifiable. By clearly communicating all costs, risks and associations, you eliminate any information asymmetry that may favour the professional over the layperson.

Ultimately, transparency and disclosure can transform your relationship from being simply transactional into a partnership built on informed consent, one that ensures your client’s best interests remain the primary driver of every decision.

There are several ways transparency and disclosure can support your fiduciary duty:

1. Transparency ensures clients have access to all relevant information about their investments, including potential risks, fees and conflicts of interest. By disclosing such information, your clients can make informed decisions and understand the implications of their investment choices. This transparency helps you fulfill your fiduciary duty by avoiding any misleading or incomplete information that could compromise any clients’ best interests.

Transparent disclosure of fees enables clients to understand the costs associated with your advice and their investments. This disclosure allows your clients to assess the value they receive from your services and make informed decisions about their financial goals.

Transparency also ensures you meet standards four and seven of the Code of Ethics; without transparency, a client cannot provide informed consent. Being transparent about your advice, particularly about any benefits you receive – whether they flow to you or your licensee – are more likely to result in costs that are fair and reasonable and represent value for money for the client, as required by the standard.

2. It is an obligation for advice professionals to avoid or appropriately manage conflicts of interest. Transparency about any potential conflicts that could compromise clients’ interests provides clarity to your clients and ensures you take necessary steps to mitigate such conflicts. Full disclosure allows your clients to evaluate the advice they receive, helps you to maintain the clients’ trust and meet your fiduciary obligations.

Being transparent about any potential conflict of interest and how it is being managed can keep you on the right side of standard three.

3. Advisers must be transparent about investment advice provided to clients: the strategies, associated risks and any potential limitations or drawbacks. Clients need to have a clear understanding of how your recommendations align with their financial goals and risk tolerance.

Transparent disclosure helps clients make informed decisions and helps you fulfill your fiduciary duty by providing suitable investment advice. Advice and product recommendations are covered by standards five, six and nine. Approaching advice with full transparency will help you meet those standards.

Ultimately, transparency enables clients to make informed decisions and trust that you have prioritised their best interests.

Client centric decision making

A commitment to client centric decision making provides the foundation for meeting your fiduciary duty. This approach means placing the client’s best interests at the forefront of each action and recommendation.

You have a legal and ethical obligation to act in all clients’ best interests, which requires prioritising factors such as their life goals, financial objectives, risk tolerance and financial security. By embracing a client centric mindset, you can tailor advice to align with each client’s unique circumstances, aspirations and long-term financial success.

A client-centric approach allows you to deliver personalised financial solutions that empower clients to achieve their objectives with confidence. This not only reinforces your fiduciary responsibility but also elevates the value and impact of the financial advice you provide.

Investing the time to understand your clients’ unique needs, preferences and concerns allows you to craft financial strategies that are both highly effective and personally resonant. This client-centric approach does more than just deliver results; it cultivates a foundation of trust and solidifies long-term loyalty, significantly boosting your professional credibility. Ultimately, a robust client-adviser relationship is the cornerstone of building and sustaining a thriving, reputable financial advisory practice.

A client first approach positions you to comply with key ethical and professional standards, including those outlined in the Code of Ethics, notably those in the ‘Client Care’ subsection (standards four-six). By prioritising your clients’ best interests at every stage of the advice process, you fulfill both your fiduciary duty and ethical obligations and, at the same time, enhance the overall quality and effectiveness of your advice.

Duty of care and skill

Fiduciary duty mandates a high standard of care and skill. Financial advisers are expected to possess and maintain the requisite expertise to provide truly competent advice. This requires a commitment to continuous professional development, staying ahead of shifting industry trends, evolving regulations and emerging best practices.

By upholding this standard of excellence, you ensure that every recommendation is underpinned by current data and optimised strategies. Fulfilling this duty not only demonstrates your professional integrity but also ensures direct alignment with the requirements of Standard ten.

Legal protection and accountability

Fiduciary duty also provides clients with legal protection and avenues for recourse in the event an adviser does the wrong thing for a client. Clients can seek redress through AFCA, and both ASIC and AFCA can hold financial professionals accountable for any misconduct or negligence that results in financial harm.

The legal framework that governs financial advice creates a strong incentive for advisers to act with integrity and maintain the trust of their clients. Legal protection and accountability are also enshrined in the Code of Ethics.

Case studies

The following case studies are based on real cases dealt with by ASIC or AFCA; however, the names of people and organisations have been changed and some details altered. For each case study, it will be shown where the adviser has potentially breached or upheld their fiduciary duty and how this did or did not comply with the twelve standards that comprise the Code of Ethics.

Case study one: A failure of fiduciary duty

Readers will be aware that there have been a number of cases relating to investments in the First Guardian Master Fund (First Guardian), many of which are ongoing. This first case study is drawn from ASIC’s actions in relation to First Guardian. Names and details have been altered.

ASIC has issued a 10-year ban against former financial adviser Phillip following findings of serious professional misconduct. The regulator determined that Phillip breached his fundamental obligations by prioritising personal gain over client welfare, specifically regarding recommendations to invest in, and roll superannuation into, the First Guardian Master Fund.

Key findings of misconduct

The investigation revealed several critical failures in Phillip’s practice:

• Conflict of interest – he accepted $100,000 in payments classified as conflicted remuneration
• Deceptive conduct – he issued SOAs falsely claiming he received no benefits that could influence his recommendations
• Failure of care – he failed to investigate the suitability of First Guardian for his clients, exposing them to unacceptable risk levels.
• Lack of competence – ASIC concluded that Phillip was not a “fit and proper person” to provide financial services and posed a high risk of future legal contraventions.

The 10-year prohibition is comprehensive. Phillip is barred from:

• Providing any financial services.
• Controlling any entity within the financial services sector.
• Performing any function related to the operation of a financial services business.

ASIC stated that its enforcement action serves to protect consumers, maintain public confidence in the financial system and act as a deterrent against similar unethical behaviour within the industry.

This case study highlights the interrelationship of fiduciary duty and ethics. As well as failing in his fiduciary duty to his clients, Phillip potentially breached nearly every standard in the Code of Ethics as follows:

Case study two: Inappropriate advice

Lydia sought compensation from her adviser, Charlie, and his firm, ACME Financial Advice, asserting that they had mismanaged her portfolio. Her primary contention was that the advice provided failed to meet her goal of maximising capital growth to facilitate retirement by age 60. She argued that the poor investment performance constituted a failure to act in her best interests.

ACME Financial Advice and Charlie denied any mismanagement, maintaining that the advice was appropriate for the client’s profile. They highlighted two key factors for the portfolio’s decline:

1. To achieve the aggressive returns Lydia desired, she would have had to take on risk levels far exceeding her documented tolerance, which would have been inappropriate and contrary to her best interests.
2. The firm noted that the significant reduction in Lydia’s portfolio balance was primarily driven by several large capital withdrawals she made over a three-year period.

The AFCA investigation of the matter saw the body rule in favour of the financial firm based on several key points:

Evidence versus recollection – while Lydia claimed her primary goal was early retirement, AFCA gave greater weight to contemporaneous documentation maintained by Charlie and ACME Financial Advice (Fact Finds, SOAs and file notes), which did not support her assertion.

Suitability of advice – AFCA concluded that advising Lydia to pursue the high-risk strategies required to attain her desired returns would have been negligent, given her recorded risk profile.

Responsibility for losses – AFCA found there to be no evidence of mismanagement; rather, the depletion of funds was attributed to market performance and Lydia’s own withdrawal history.

AFCA found the advice to be appropriate and determined that ACME Financial Advice was not liable for compensation. In this case, Charlie met his fiduciary duties. Specific standards in the Code of Ethics that he upheld in relation to this case include:

Case study three: A violation of fiduciary duty

The case against Simon involves a severe breach of the fiduciary relationship between a financial adviser and their client. Simon received $476,000 from his client George, specifically earmarked for investment in designated stocks.

Rather than executing George’s instructions, Simon misappropriated the funds to engage in personal trading on his own account. Following significant trading losses, he engaged in deceptive conduct by leading George to believe his investment remained intact, effectively concealing the loss.

Upon an ASIC investigation, it was determined that Simon’s actions demonstrated a fundamental lack of the integrity required for the advice profession. The regulator’s findings focused on three key areas:

Character and judgment – Simon was found to lack the necessary judgment and character to operate within the financial services industry.

Suitability – Simon was officially declared not a ‘fit and proper person’ to hold a position of financial trust.

Legal contravention – Simon’s conduct represented a flagrant misuse of client funds and a total breach of professional trust.

To protect consumers and maintain the integrity of the Australian financial system, ASIC imposed a permanent ban, prohibiting Simon from:

• Providing any form of financial service.
• Controlling any entity that carries on a financial services business.
• Performing any professional function within the industry.

This case is a reminder of the consequences of violating the duty of loyalty. Fiduciary duty is not merely a regulatory checkbox; it is a legal and ethical mandate to keep client assets separate and secure.

Transparency is required even (and especially) when losses occur; ASIC noted that deceptive reporting to hide a breach of trust is viewed as a separate and serious offense.

As a result of his actions, Simon potentially breached the following standards in the Code of Ethics:

Case study four: Fulfilling one’s fiduciary duty

The complainants in this case, Adam and Deanne, were growth investors with an ongoing advice relationship with ACME Financial Planning that spanned 15 years. The couple were informed investors, and both paid the highest marginal tax rate.

In 2020, the couple received advice from their adviser, Monique, that they should decrease their exposure to international equities in favour of Australian equities. The couple subsequently claimed the advice was not in their best interests and contrary to ACME Financial Planning’s own target asset allocation. As a result of the greater weighting to Australian equities, the couple claimed the portfolio underperformed by 14.7% – or $52,630 in dollar terms.

ACME Financial Planning acknowledged the allocation was contrary to its target allocation but said this was in the couple’s best interests because it provided access to tax benefits in the form of franked dividends. It also provided greater stability as it reduced foreign currency risk. The overweighting to Australian equities was clearly disclosed and explained in the Statement of Advice (SOA) that accompanied the advice.

The subsequent AFCA investigation determined that the advice Adam and Deanne received was in their best interests. Although it resulted in them having a greater exposure to Australian equities, AFCA was satisfied the rationale was clearly articulated and documented, and the reasons were not contrary to either party’s best interests.

Consequently, AFCA found in favour of Monique and ACME Financial Planning; neither party needed to compensate the client.

Clients seeking financial advice expect the advice provided will leave them in a better position. Section 961G provides that the resulting advice must be appropriate to the client. In relation to this advice, AFCA found there was a sound basis for deviating from the firm’s target asset allocation.

This case study demonstrated that financial adviser Monique had done the right thing. As such, she most likely complied with the following standards of the Code of Ethics:

Fiduciary duty is more than a regulatory hurdle; it is the moral and professional backbone of a sustainable financial advice practice. By centring the client’s best interests, advisers move beyond the role of a mere service provider to become a trusted partner in their clients’ life journeys. This commitment to loyalty, transparency and professional care does more than protect the public – it builds the very credibility and trust that allow a practice to flourish over the long term. In an industry where reputation is a valuable asset, upholding a rigorous fiduciary standard is not just a legal obligation, but the hallmark of professional excellence.

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Switching advice must be supported by a clear rationale, grounded in the client’s best interests and able to demonstrate a net benefit after fees.

Superannuation switching – so hot right now

Superannuation switching is arguably the hottest topic in financial advice right now.

It is at the centre of narratives around high-profile advice and product failures, changes to the Compensation Scheme of Last Resort (CSLR), the evolving landscape of competitive superannuation flows, and regulatory reform priorities. It is the subject of a very public battle between advocates for industry funds and retail providers, and it has fuelled widespread coverage through both trade and mainstream media.

The potential for consumer harm from inappropriate switching was already on ASIC’s radar following the release of Rep 781 in 2024^[1], and recently heightened regulatory and policymaker scrutiny has culminated in the April 2026 release of Treasury consultations^[2] on proposed reforms impacting super switching and lead generation.

This article examines the key dynamics within this issue, including the drivers of increased switching and the consumer risks identified by regulators. It also frames potential regulatory outcomes and suggests practical steps advisers can take to ensure their switching advice remains compliant and robust in the face of likely reforms.

Super switching is big business

To truly understand why superannuation switching is now receiving so much media attention and regulatory focus, it is necessary to appreciate the broader industry context around superannuation flows and retirement trends.

The compulsory nature of Australia’s superannuation system has underpinned its remarkable growth. As the superannuation savings pool has grown (it now exceeds $4.5 trillion^[3]), it has collided with our ageing population to create a ‘silver tsunami’ of Australians who are retiring with (1) higher superannuation balances than ever before, and (2) more need for advice to navigate an increasingly complex retirement income system.

The combination of these forces has in turn driven an increase in switching activity between funds. Some of this switching is self-directed, as members are forced out of funds failing the APRA performance test, or as they heed messages about fund consolidation to reduce fees. Other switching is driven by advisers seeking to place their clients in funds offering better performance, wider options, more responsive service and greater transparency.

In the case of advisers, many are finding the superannuation offerings of leading retail platforms to be superior to many large incumbent funds, powering a flow of funds away from legacy master trusts and industry funds. The 2026 State of Super report^[4] from the Conexus Institute, alongside various media reports, speaks to the scale of this trend, and provides a more precise view of how these flows are occurring.

The report estimates that around $40b of switching activity – or approximately 52% – involved a financial adviser, with a significant proportion of switches directed toward leading retail platforms including Hub24 and Netwealth. At the same time, several large industry funds, including Australian Super, ART, HESTA, and Rest, are experiencing competitive net outflows, as are for-profit master trusts including AMP Super, Insignia, and Mercer.

The potential for adverse switching outcomes was already on ASIC’s radar

As the size of the superannuation pool increases, so too does the number of businesses attracted to the sector and its revenue potential. Sadly, not all these businesses will be compliant and customer focused, a point which has been recognised by ASIC for some time, and which was reinforced by their review of superannuation trustee practices, published as Report 781^[5].

Released in May 2024, ASIC’s Report 781 identified a range of concerns, including in relation to advice fee deductions and harmful switching activities, particularly where member balances were eroded by inappropriate advice charges.

The report specifically highlighted the role of “high-pressure, cold calling for superannuation switching business models”, noting that these practices were associated with:

• unnecessary, generic or inappropriate advice
• switching into unsuitable superannuation products
•  poorer retirement outcomes for members.

ASIC identifies poor conduct by advisers and licensees as central to consumer harm. However, it also made clear that the way trustees oversee advice fee deductions can either mitigate or allow these risks to persist.

Such oversight could include

• proactive checks of advice documents
• the use of appropriate fee caps and
• consent controls and more active monitoring of advisers and licensees.

Recent high profile fund failures are the catalyst for even more scrutiny

Two recent high-profile fund failures^[6] have proved to be the catalyst for further heightened regulator and media scrutiny of superannuation switching practices.

A central feature of these failures was the role of lead generators in identifying and targeting prospective clients, often through cold-calling or digital acquisition strategies, and encouraging them to switch into higher-risk investment structures with the promise of superior returns. In many cases, these interactions formed part of a broader distribution chain involving marketing firms, referral partners and authorised representatives.

These third-party lead generation models typically attract consumer interest through offers such as a ‘free super health check’, retirement readiness tools or comparison-style calculators. While these gamified propositions can appear educational or informational in nature, they can in practice form part of a structured lead-harvesting process designed to direct consumers toward a particular advice provider or product.

In its March 2026 announcement^[7] of a formal review into the use of lead generation by advice licensees, ASIC made clear that its concerns extend beyond isolated instances of poor advice, to the broader ecosystem through which clients are acquired. This includes the role of follow-up engagement practices, including outbound calling and high-pressure sales tactics, which can move consumers rapidly from initial enquiry to switching decisions. When combined with inadequate advice processes, these models increase the risk that members are transferred into new superannuation arrangements without a clear and demonstrable benefit.

(The depths of ASIC’s concern about this sector were further highlighted when they simultaneously announced their intention to publish a register of advice licensees using lead generation services^[8].)

Switching and consumer protection becomes the regulatory priority

The understandable outrage caused by these fund failures, and the life-altering harm they caused to affected investors, has prompted a strong response from across the industry and among policymakers.

The Superannuation Members Council, for example, representing industry funds, has sought to highlight concerns in respect of superannuation switching more broadly^[9]. Their position – including analysis suggesting that switching among younger members may often be to their detriment – has been the subject of much discussion and debate across the industry^[10].

Regardless of the veracity of their claims, concerns around superannuation switching as a potential source of consumer harm have clearly gained traction among policymakers at the highest levels and are already influencing policy direction.

DBFO Tranche 2 put on the backburner

Perhaps the most visible example of this influence can be seen in the Federal Government’s recently revised financial services reform agenda.

In early 2026, Financial Services Minister Daniel Mulino indicated that his regulatory focus would shift toward addressing poor consumer outcomes linked to advice, lead generation and superannuation flows^[11]. While broadly welcomed at a community level, for advisers this shift has had a clear consequence, with the overdue Tranche 2 of the DBFO now a lower priority and delayed.

During a recent adviser webinar, FAAA CEO Sarah Abood commented on her dealings with the Minister, saying she didn’t believe the reforms are dead but that “DBFO appears to be further back in the queue”^[12].

This change in focus is already evident, with April 2026 seeing Treasury release two consultations for proposed legislation directly impacting switching activities:

• “Enhancing member protections in the superannuation system”^[13]
  Changes considered include limits on the deduction of fees from super when switches are involved, and the introduction of a cooling-off period for switches.
• “Curbing lead generation activity”^[14]
  Examining the role of third-party marketing firms, referral arrangements and client acquisition models in initiating switching activity.

(A third consultation was released at the same time, addressing changes to the CSLR).

Proposed switching advice reforms: the consultations in detail

The two Treasury consultations highlighted above make it clear that superannuation switching is now being treated as a system-level concern, spanning advice quality, distribution practices and trustee oversight. Each is explored in more detail below.

Consultation 1: advice fees to be prohibited where switching is involved?

Here Treasury proposes mechanisms to protect members from adverse switching outcomes, including a cooling-off period and prohibiting or limiting the deduction of fees from super where switching is involved.

Key reforms proposed include:

• Introduce a waiting period for inter-fund superannuation switching
  Require members to formally confirm their request to switch within a mandated waiting period (for example 5 days).
• Limit fee deductions for switching-related financial advice
  Options include total prohibition of fee deductions for switching related advice (requiring clients to pay out of pocket), targeted prohibition (for example based on age or balance thresholds), fee caps, or requiring trustees of the receiving fund to review fee deductions in line with members’ best financial interests.

Other proposals include strengthening platform governance, increasing penalties under the SIS Act, and a requirement for trustees to compensate members for eligible losses.

Consultation 2: Lead generation – scrutiny of client acquisition models

These proposals reflect a growing concern that poor consumer outcomes can originate well before advice is formally provided.

Key changes put forward include:

• Regulation of lead generation activity
  Options include bringing prescribed lead generation activities within the financial services regulatory framework or banning certain unlicensed communications to consumers about superannuation.
• Accountability of advisers and licensees
  Proposals include enhancing the accountability of licensees for the conduct of lead generators and clarifying how existing obligations apply where clients are referred through these arrangements.
• Extension of anti-hawking requirements
  Looks at options to strengthen anti-hawking protections, including conditions around consumer consent and limits on unsolicited contact.
• Remuneration structures linked to referrals
  Options include capturing lead generators under the conflicted remuneration framework or clarifying the scope of benefits that may incentivise poor conduct.
• Advertising and disclosure requirements
  Canvases additional measures to improve transparency, including requirements relating to financial advertising and earlier regulatory intervention.

Compliant switching advice – a refresher

ASIC Info Sheet 182^[15], first published in 2013, sets out how advisers should approach superannuation switching advice in practice, containing detailed guidance and practical tips.

Ahead of any of the abovementioned proposed reforms becoming law, advisers may find it useful to refresh their knowledge of ASIC’s expectations in this area of advice.

1. What is super switching advice?

Super switching advice refers to personal advice given to a retail client about:

• transferring an existing super balance (in whole or part) to another fund
• redirecting future contributions from one fund to another.

Advisers must consider the substance of the advice, including:

• verbal discussions
• Statements of Advice (SOAs)
• Financial Services Guides (FSGs)
• other written communications.

ASIC assesses the overall impression created by the advice.

Compliance tip

In ASIC’s surveillance, they will look closely at the files of advisers who seem to have a number of clients who only want advice about the ‘to’ fund, although they are still eligible to remain in their ‘from’ fund.

2. Satisfying the best interests duty

Super switching advice must satisfy all elements of the best interests duty.

This requires advisers to:

• Make reasonable inquiries into the client’s relevant circumstances, including:
  • age, dependants and retirement objectives
  • financial needs and goals
  • insurance requirements
  • existing super and investments
  • tax position
  • risk tolerance and financial literacy.
• Investigate and understand the subject matter of the advice, including:
  • both the existing (‘from’) fund and proposed (‘to’) fund
  • the consequences of switching.
• Provide advice that is in the client’s best interests.

ASIC states that switching advice will generally be inappropriate where:

• the overall benefits of the ‘to’ fund are likely to be lower than the ‘from’ fund, unless outweighed by cost savings
• the ‘to’ fund has higher costs without a clear basis that it better meets the client’s needs.

Compliance tip

Where advisers recommend switching, but there is no obvious overall advantage to the client in making the switch, ASIC is more likely to look closely at the disclosure given to the client about conflicts, fees and the basis for the advice.

3. Information about the ‘from’ fund

Advisers must obtain and consider relevant information about the client’s existing fund.

Sources may include:

• Product Disclosure Statements and product dashboards
• member statements and annual reports
• fund websites or direct contact with the trustee
• independent research.

If sufficient information cannot be obtained, the adviser should seek the information directly or decline to provide switching advice.

Compliance tip

Switching advice cannot be provided without sufficient information about the ‘from’ fund, and a lack of client-provided information does not remove this obligation.

4. Statement of Advice requirements

For all super switching advice, the SOA must clearly explain:

• the costs of the recommendation
• the benefits of the recommendation
• the significant consequences of acting on the advice.

This applies to both full balance transfers and the redirection of future contributions.

Examples of inadequate disclosure include:

• statements that fees are higher without quantifying the difference
• references to “better features” without explaining what they are and why they are relevant
• generic statements about potential loss of insurance without detail.

Compliance tip

It might be misleading to describe a feature of the ‘to’ fund as a benefit of making the switch unless that feature satisfies a client’s needs or objectives and is not already available in the ‘from’ fund.

5. Insurance considerations

Advisers must consider the impact of switching on insurance arrangements.

This includes:

• identifying existing cover in the “from” fund
• assessing whether equivalent cover is available in the “to” fund
• explaining any loss, reduction or change in cover

Compliance tip

Disclosure must go beyond stating that “if you have insurance, you will lose it if you switch”.

Advisers should explain:

• the level of cover
• cost implications
• impact on the client.

6. Advice involving SMSFs

Where switching involves establishing an SMSF, advisers must consider:

• the client’s ability to act as trustee
• financial literacy and understanding of obligations
• time and resources required to manage the fund
• ongoing costs
• availability and cost of insurance.

Clients must also understand that SMSFs do not have the same protections as APRA-regulated funds

Compliance tip

ASIC will look for instances where an adviser has:

• advised a client to establish an SMSF when their current super savings are insufficient and their circumstances do not otherwise support the advice; or
• failed to advise a client properly about ongoing costs (at least in very broad terms, based on average costs) and the time and skill needed to administer an SMSF.

7. Use of disclaimers

Disclaimers may be used to define the scope of advice in limited circumstances. However, disclaimers do not remove an adviser’s obligation to:

• make reasonable inquiries into the client’s circumstances
• investigate the subject matter of the advice
• ensure the advice is appropriate

Compliance tip

Even if a disclaimer says, ‘this is not advice about the ‘from’ fund’, this disclaimer will not let you limit your consideration to the ‘to’ fund if the substance of your advice is or includes a recommendation to switch.

Practical application of INFO 182

ASIC’s position is that switching advice must be supported by a clear, evidence-based rationale.

In practice, this requires advisers to demonstrate:

• a comparison of the ‘from’ and ‘to’ fund
• a clear explanation of costs and benefits
• consideration of insurance and other consequences
• a documented basis for concluding the client is better off.

Where these elements are not present, the advice is likely to be considered inappropriate.

Additional considerations in light of the proposed reforms

Although the proposed reforms to switching and lead generation are not yet law, they provide a clear indication of where regulatory scrutiny is likely to increase.

Lead generation

In anticipation of the proposed reforms, advisers should:

• be able to clearly explain how a client entered the advice process
• review whether any referral or lead generation arrangements are transparent in their commercial intent
• consider whether the client journey, from initial engagement through to advice, could be seen as influencing a decision to switch

Advice fees and switching

In anticipation of these reforms, advisers should:

• ensure that any switching recommendation can demonstrate a clear net benefit after fees
• consider how the method of fee deduction, particularly from superannuation at the point of switching, would be viewed by a regulator or trustee
• ensure the link between the advice provided and the fee charged is clearly articulated and documented

Conclusion

Recent high-profile fund failures have seen superannuation switching take centre stage as both a media issue and a regulatory priority. ASIC’s review activity and Treasury’s consultations make clear that scrutiny is increasing, not just on the quality of advice, but on how switching is initiated and paid for.

For advisers, their core obligations remain unchanged. Switching advice must be supported by a clear rationale, grounded in the client’s best interests and able to demonstrate a net benefit after fees.

As the level of scrutiny intensifies, advice processes must now stand up to closer examination across the full client journey, from acquisition through to implementation. Advisers who maintain strong documentation and clear client reasoning will be best placed to deliver compliant and defensible switching advice now and in the future.

Take the FAAA accredited quiz to earn 0.5 CPD hour:

CPD Quiz

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Legislated CPD Area: Regulatory Compliance & Consumer Protection (0.5 hrs)

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References:
[1] https://www.asic.gov.au/regulatory-resources/find-a-document/reports/rep-781-review-of-superannuation-trustee-practices-protecting-members-from-harmful-advice-charges/
[3]https://www.superguide.com.au/super-booster/largest-super-funds#:~:text=Superannuation%20is%20now%20very%20much,Billion.
[4] https://theconexusinstitute.org.au/wp-content/uploads/2026/02/State-of-Super-2026-Final-updated-20260213.pdf
[5] https://www.asic.gov.au/regulatory-resources/find-a-document/reports/rep-781-review-of-superannuation-trustee-practices-protecting-members-from-harmful-advice-charges/
[6] https://www.novigi.com.au/the-shield-and-first-guardian-failure-data-and-technology-lessons/
[7] https://www.asic.gov.au/about-asic/news-centre/find-a-media-release/2026-releases/26-029mr-asic-commences-new-review-of-advice-licensees-that-use-lead-generation-services/
[8] https://www.ifa.com.au/regulator-publishes-advice-lead-generation-list-and-launches-review/
[9] https://www.ifa.com.au/smc-doubles-down-on-super-switching-concerns/
[10] http://investmentmagazine.com.au/2026/03/super-switching-paranoia-drives-misinformation-campaign/
[11] https://www.investmentmagazine.com.au/2026/02/high-priority-mulino-ties-dbfo-to-consumer-protection
[12] https://www.ifa.com.au/ministers-dbfo-language-has-changed-as-wait-for-reforms-continues/
[13] https://storage.googleapis.com/files-au-treasury/treasury/p/prj3bbdc0dd212e233479128/page/c2026_756030.pdf
[14] https://storage.googleapis.com/files-au-treasury/treasury/p/prj3bc3bd170b62c39129f2e/page/c2026_756975.pdf
[15] https://www.asic.gov.au/regulatory-resources/superannuation-funds/superannuation-guidance-relief-and-legislative-instruments/super-switching-advice-complying-with-your-obligations-info-182/

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The ability to take a successful set of systems and apply them across other business units can be the most valuable capital element in a professional services firm.

Creating great capital value for a professional services firm is usually one of the owners primary objectives as they more often than not see their business value as a critical part of their own financial independence.

Building a profitable business is obviously essential, and it is a more valuable profitable business if a large proportion of the revenue carries certainty of continuity for any prospective purchaser. Pretty much everyone gets that of course, hence the emphasis upon growing renewal commission income or setting ongoing fee for service or advice contracts with clients.

That’s the first key lever that ratchets up the capital value of a firm: predictable revenue.

The more certain a future income stream appears to be, the more highly it is generally valued by an investor. A firm which is dependent for its revenue upon the key sales skills of a handful of rainmakers just doesn’t have the same predictability in future revenue as one where clients hold ongoing contracts for service with the firm for example.

The second big lever is dependable experience. The client experience with the firm in terms of the type of advice or service they receive, and the consistency with which it is delivered, the positioning and branding of every client interaction creates certainty for the clients. In certainty there is familiarity, which leads to trust and a consistent feeling of expectations being met.  That homogeneous client experience leads to higher retention of clients, and if done well it also leads to higher ongoing participation by clients in the firms services. So dependability delivers clients who will stay longer and also do more business with the firm. THAT is worth paying a bit more for if one is buying a firm, right?

How transferable is the firm? If extracting the capital value to fund the current owners retirement is an objective, then one of the key valuation considerations must be “how easy is it for someone else to step in and run this business and gain the expected business performance?“

Staff contracts and  culture, IT and client management systems, advice or service systems, prospecting and marketing methodologies….these are all examples of the areas where significant roadblocks (or value detractors) can lie….or where major enhancements to capital value of the practice can be created. Smart business purchasers will give some serious consideration to the ease of transfer of ownership, or integration into another business, and their view of the value of the firm will be adjusted accordingly.

The last of the big levers driving higher value for professional services firms is whether the business has the potential to be repeatable. Not all business purchasers actually want a practice which can expand into multiple locations or markets of course, but the ability for systems and intellectual property to be duplicated and repeated elsewhere is attractive to a purchaser. Often we have seen institutional buyers of advice practices over the years, and it is this 4th key lever which often drives the transaction. The ability to take a successful set of systems and apply them across other business units can be the most valuable capital element in a professional services firm.

If a practitioner were to build all 4 of these into their firm there is little doubt that the firm will be far more attractive to potential purchasers, and attract far greater valuation multiples than the atypical practice.

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The differences between the high performers and the average ones are not magic.

Advisers frequently settle for being average, and it is definitely not because they want to be average but because they don’t really know what it takes to elevate their performance exponentially. Average adviser performance can be turned into outstanding adviser performance by making the changes that make the difference.

The average advisers often ask how someone else can be so much more successful than they are and assume that there is some magic at work.

The differences between the high performers and the average ones are not magic, and nor are they unachievable for the majority.  In fact, it is mostly about being better organised, being more transparent, and communicating better.  These are elements that any adviser can work on immediately.

High performers are better at understanding their clients key expectations:

• listening and understanding their needs
• being continually trustworthy
• depth and breadth of industry information the adviser can provide
• being a problem solver
• timely and personal, not mechanical, communication
• overseeing the family’s financial affairs – not marketing products to them
• delivering high level personal service.

They get more information and know their clients better.

They listen better.

High performers also focus on the financial factors that their clients care most about, which are:

• meeting investment performance expectations
• protecting investments from downside risk
• making them fully aware of fees all the time
• helping create a financial plan and keeping it current
• using current technology for access and reporting
• coordinating and organizing their financial documents
• providing appropriate insurance solutions – and only for as long as they actually need them

They are focused on what matters to the client.

They put the clients interests first.

The high performers core business attributes?

1. Their team works as a unit and practices effective delegation.
2. Everyone in the business has clear roles and responsibilities.
3. They deliver a consistent client experience.
4. They do not try to be the experts in everything, but bring in the right experts their clients need.
5. Achievement focussed, with high energy levels and high job satisfaction.
6. They focus on face-to-face communications wherever possible.  The telephone or email is a secondary preference.
7. They are proactive in tough times – and raise the communication levels.

They play to other people’s strengths.

They have high expectations.

Compare this to the attributes of the less-than-average adviser:

• It is all about me, the adviser.  “What is in it for me” is the dominant mindset.
• Minimal delegation, and adviser tries to be the “main man”.
• Blurry roles and responsibilities within the firm, if indeed there is actually a “firm”.
• Inconsistent client experiences.
• Adviser tries to do, and be, everything.
• They project their own value based on market movements or product performance.
• There is a strong transactional approach, coupled with a “follow what’s hot” mindset.
• Opinionated, and with a narrower knowledge base.
• Tend to be sedentary, often on the phone or at the desk for bulk of the day.
• Status consciousness, with accompanying money focussed.
• High stress and angst, accompanying relatively low job satisfaction.

As the two types of adviser are compared it becomes obvious quite quickly that the difference between the high performers and others largely begins within the advisers own mindset and attitude.  Particularly the attitude towards clients.  The approach they take to their clients would actually appear to be the primary point of difference when you get right down to it.

Combining that attitude with some sound commercial and management skill and a willingness to invest in building a business rather than executing transactions is the “magic” if there is any.

Building leverage within the business and the customer experience with a great support team that plays to individuals strengths then leads to exponential growth.  Add in constant quality communications and a client service focus which improves account retention and you have a winning business model.

It begs the question:  If that is all it takes, why would anyone settle for average adviser performance?

The post Why settle for average Adviser performance when you could be outstanding? appeared first on AdviserVoice.

Ethics form the foundation of advice, underpinning trust, long-term client relationships and a resilient, sustainable business.

Ethics in financial advice isn’t just about ‘doing the right thing’ to sleep better at night, it’s the fundamental bedrock of a sustainable business model. In this article, proudly sponsored by GSFM, the importance of ethical practice is explored.

In the world of financial advice, it’s common to speak in the language of numbers: compound returns, asset allocation, insurance, yield…

However, the true foundation of a thriving advice practice isn’t found in numbers, it’s built upon the bond of ethical integrity. When a client walks into your office, they aren’t just looking for a higher rate of return. Instead, they’re looking for a partner they can trust with their future, their legacy and, importantly, their peace of mind.

Choosing to lead with ethics is a proactive commitment to excellence. It transforms the adviser-client relationship from a transactional relationship to a partnership. By placing professional standards and the client’s best interests at the centre of every decision, an advice practice does more than just meet requirements, it creates a sense of security, important in this increasingly volatile world.

In this light, a code of Ethics is not a restrictive set of rules. It is a tool that fuels long-term business growth because it fosters deep-seated client loyalty and elevates the professionalism of financial advice.

Professional standards reforms for financial advisers were introduced to the Corporations Act 2001 in March 2017. These reforms were designed to raise the education, training and ethical standards of those providing personal advice to retail clients on ‘more complex financial products’^[1]. Those reforms required FASEA (as was) to develop the Financial Planners and Advisers Code of Ethics (Code of Ethics), which came into effect in January 2020.

The introduction of the Code of Ethics came with an expectation from ASIC that Australian Financial Services licensees would take reasonable steps to ensure that their authorised representatives comply with the Code. For example, licensees must:

• Ensure their authorised representatives are aware of the need for compliance with the Code of Ethics and that this compliance is ongoing.
• Provide training and/or guidance to their authorised representatives about the types of conduct that is consistent/inconsistent with the Code of Ethics..
• Facilitate individual advisers’ ability to raise concerns with the AFS licensee about how the licensee’s systems and controls may be hindering their ability to comply with the Code of Ethics, and act on those concerns where appropriate.
• Consider whether advisers are complying with the Code of Ethics as part of their regular, ongoing monitoring of adviser conduct.
• Make any necessary changes to systems and processes to ensure compliance with the Code of Ethics and other regulatory requirements.

The Code of Ethics addresses five core values: trustworthiness, competence, honesty, fairness and diligence. It requires that financial advisers must act at all times and in all cases, in a manner that is demonstrably consistent with Code’s twelve ethical standards, summarised in figure one. These standards are regulated and monitored by ASIC’s approved compliance schemes.

Ethics is a ‘team sport’

An ethics-centred approach is not a solo performance by the adviser; it is a team sport played by the entire practice. From the first greeting at the front desk to the final signature on a Statement of Advice, every touchpoint is an opportunity to reinforce a culture of integrity, professionalism and care.

The ethical chain of command

To truly embed the values that underpin the Code of Ethics, every role within an advice practice must understand that ethics isn’t just the adviser’s responsibility, they need to know how the Code of Ethics translates into their roles. For example:

• The receptionist – as the face of the firm, they champion ethics through data privacy and by creating a welcoming, transparent environment for every client who walks through the door.
• The paraplanner and administrator – these ‘engineers’ of the financial plan need to ensure that every strategy is executed with technical precision and that paperwork is handled with the highest degree of integrity.
• The practice manager – by prioritising ethical training and fostering an open-door policy, they ensure that the practice’s moral compass remains calibrated as the business grows and new staff join the team.

While every staff member must perform their duties in a way that aligns with the firm’s values, the professional weight remains clearly defined. Each team member’s commitment provides the essential support that allows advisers and licensees to fulfill their regulatory obligations.

Ultimately, although the entire team builds the culture, the adviser and licensee stand as the final guardians of the practice and bear the ultimate responsibility for ensuring that every action taken meets the highest standard of care.

To establish an ethics-centric practice and minimise the risk of violating the Code of Ethics, there are a range of strategies that could be implemented. These include:

1. Code of conduct: by establishing a practice-wide code of conduct, one which encapsulates your firm’s values as well as the Code of Ethics, your team should have a clear understanding of their role and the expectations that go with it.

Any code of conduct should set clear expectations about employee behaviour when performing their role and, in an ethics-centric practice, how each of the twelve standards may specifically intersect their role. This should be a concise and accessible document that is distributed to all staff members, and which is readily available for reference.

2. Communication: establish clear communication channels within your practice to convey the importance of ethics. Regularly discuss ethical considerations during team meetings, emphasising the relevance of the Code to each staff member’s role. A collaborative environment where colleagues can monitor and support each other in upholding ethical standards is important to create and maintain an ethical practice. Encourage open discussions about ethical dilemmas and provide guidance on navigating challenging situations.

It’s also important to communicate clearly, openly and honestly with your clients. In the initial meetings, don’t simply tell them what you will do for them, but detail how you will work with them to achieve their objectives. Establish ongoing channels of communication and explain how you will communicate with them. It’s important to detail the method and frequency.

Remember that it’s important not to make promises that cannot be honoured. As well as potentially breaching the Code, it will reflect badly on the practice.

3. Set key performance indicators (KPIs): by reinforcing your company’s values, adhering to your practice’s code of conduct and behaving in a way that makes ethical behaviour central to each team member’s work will support the creation of an ethical practice. Although a value driven KPI may sometimes be more challenging to quantify than one with specific and measurable outcomes, it will highlight the importance of values and ethics to your practice.

The implementation of accountability measures will ensure that all staff members integrate ethical considerations into their daily responsibilities. Further, to recognise and reward ethical behaviour will reinforce a positive ethical culture.

4. Checklist: a checklist can be used to safeguard compliance with the Code. The questions in the checklist should be tailored to each role in the practice and include those relevant to dealing with prospective clients, new clients and existing clients.

5. Workplace training: this is essential to ensure all staff understand both the practice’s values and the obligations of the Code. Using workshops to promote ethics in your workplace will reinforce the practice’s standards of conduct and clarify behaviours and practices that do and don’t work within your own code of conduct – and within the Code.

Importantly, ethics training should not be a once off. Ethics training could be incorporated as part of a regular team meeting; for example, by using a variety of case studies that address common ethical dilemmas across the financial planning industry. It can be used to emphasise your firm’s commitment to continuous improvement in ethical practices. It also provides an opportunity to seek feedback from staff as to how the practice can better support ethical decision-making and incorporate this input into ongoing improvements.

Ideally, this workplace training should be practical as far as possible and teach team members to make good decisions that are compliant with the law and consistent with your practice’s values.

Ethics training should also be incorporated into the onboarding process for new employees.; this will ensure they receive the necessary information and guidance to understand and comply with the Code from the beginning of their tenure.

6. Feedback loop: by encouraging staff to provide honest feedback about the processes, conversations and client interactions, you are better placed to make sure you’re aware of issues that may arise that could potentially compromise your business. A feedback loop can help you identify gaps in relation to processes and procedures, and where a checklist or workplace training may be useful tools.

7. Lead by example: regardless of your position in a practice, it’s important to set a good example. For those who are senior in the practice, it’s more important to demonstrate those behaviours that are and are not acceptable. Senior advisers and personnel will set the tone for ethics in the practice; as such, they need to embody the Code in all they say and do.

8. Regular audit: These or similar strategies may have already been implemented in your practice. If so, it’s important to review the effectiveness of each. What’s working well and what’s not? If you can identify gaps in processes that may lead to a breach of the Code, it’s better to identify them ahead of time than when ASIC comes knocking on your door.

Why is an ethics-centric practice important?

An ethics-centric practice is important because it transforms the nature of financial advice from a mere commodity into a high-trust partnership. In an industry where clients often share their most intimate life goals and vulnerabilities, a firm commitment to ethical standards provides a moral compass that guides every decision, especially when regulations don’t provide a clear-cut answer.

A culture of integrity does more than just protect the firm from reputational risk; it creates a superior client experience characterised by transparency and peace of mind. Ultimately, when a practice prioritises doing the right thing, it builds a sustainable legacy where the interests of the adviser, the staff and the client are perfectly aligned. This ensures long-term success that can be measured by more than just assets under management.

Furthermore, aside from the legal obligations the Code place on licensees and advisers, ethics play a crucial role in running a successful financial advice practice. The reasons for this in more detail:

1. Client trust: ethical behaviour builds trust and clients are more likely to trust a financial adviser who demonstrates a commitment to ethical conduct. Trust is fundamental in establishing and maintaining long-term client relationships.

Each of the Code’s standards is trust building. A failure in any one area can erode trust and derail the adviser/client relationship.

2. Integrity and professionalism: an adherence to ethical practices upholds the integrity of the financial advice profession. It demonstrates both professionalism and a dedication to acting in the best interests of clients. This, in turn, enhances the credibility and reputation of the individual financial adviser, his or her practice and the industry as a whole.

While integrity underpins several of the Code of Ethic’s standards, it is a specific requirement of standard two, which requires advisers to always act with integrity.

3. Client’s best interests: financial advisers have a fiduciary responsibility to act in the best interests of their clients. Ethical behaviour ensures that financial advisers prioritise their clients’ needs and goals over their own, thereby avoiding conflicts of interest that could compromise the quality of advice provided.

Acting in each client’s best interests is aligned with several standards within the Code of Ethics, notably standards two and five that specifically reference client best interests. Other standards also align with the need to act in a client’s best interests, including standard three (avoiding conflicts of interest), standard four (acting with informed consent) and standard six (consider the long-term effects of advice).

4. Legal and compliance: ethical behaviour aligns with the legal requirements and regulations governing the Australian financial advice industry. Financial advisers who act ethically are more likely to comply with legal standards and have a reduced risk of encountering legal issues or regulatory scrutiny. Unethical behaviour can result in legal consequences, damaging both your career and the practice’s reputation.

Standard one of the Code of Ethics requires that advisers act in accordance with all applicable laws (including the Code).

5. Risk management: ethical decision-making contributes to effective risk management. By considering all advice through an ethical lens, advisers can identify and mitigate potential risks, protecting both clients and the reputation of the advice practice.

This also comes back to standard two, the requirement to act with integrity, for this is a quality that enables advisers to identify and manage risks.

6. Long-term success: ethical behaviour will contribute to the long-term success of your practice. Clients who feel well-served and that you have always acted in their best interests are more likely to remain loyal to you and provide referrals, contributing to the ongoing growth and success of your business.

7. Industry reputation: ethical conduct by financial advisers collectively enhances the reputation of the entire financial services industry. Unethical practices can lead to negative perceptions and erode public trust, affecting not only individual advisers but the industry as a whole.

The reputational damage possible to the industry is the subject of standard twelve and its requirement that individually and in cooperation with peers, advisers must uphold and promote the ethical standards of the profession.

8. Personal satisfaction: Knowing you are making a positive impact on your clients’ lives, acting in clients’ best interests and adhering to a strong ethical framework is likely to enhance the sense of purpose and professional satisfaction in your work. Replicate this across your practice and it’s a recipe for success.

Case studies

The following case studies are based on ASIC’s enforcement activities, FSCP cases or AFCA complaints; however, names and other details have been changed for privacy reasons.

Case study one: Failing to sufficiently account for client circumstances

Financial adviser Margot, an authorised representative of ACME Advice, was referred to the FSCP sitting panel after ASIC became aware of allegations of misconduct. The sitting panel determined that Margot contravened sections 961B(1), 961G and 921E(3) of the Corporations Act 2001 in relation to advice provided to two of her retail clients between February 2023 and April 2024.

In relation to the first client, the sitting panel found that Margot had failed to make “reasonable inquiries to obtain complete and accurate information about whether the client held insurance through their existing superannuation before recommending that the client transfer their superannuation from one fund to another fund”.

The second case regarded Margot’s failure to base all judgements in advising the clients on their relevant circumstances. The sitting panel determined that there were “numerous errors and inconsistencies recorded in the SOA” regarding:

• where the client’s existing superannuation was held
• the client’s self-employed status
• whether the client held insurance or not.

Further, the panel commented that in providing the advice, Margot had “failed to demonstrate the Code of Ethics’ values of competence and diligence and breached Standards 5 and 9 of the Code of Ethics.”

In this instance, Margot received a written reprimand from the FSCP.

The FSCP sitting panel determined that Margot breached two standards. There are other potential standards the panel could have considered to have also been breached as follows:

Case study two: Dishonest practices

Financial adviser Sam was a sole practitioner whose financial advice practice, ACME SMSFs, focused on dealing in listed securities and advising on self-managed superannuation funds (SMSFs). He was investigated by ASIC after clients Pam and Nigel grew concerned about funds being withdrawn from their SMSF, transactions they had not authorised.

Although Sam did not initially cooperate with ASIC’s investigation, the regulator eventually exposed his dealings and found Sam had:

• made 144 unauthorised transfers, impacting 11 clients, totalling nearly $2.75 million
• used these stolen funds for personal reasons, including gambling and paying off personal debt
• made false representations to clients and other third parties about the unauthorised transfers with the intent to conceal his dishonest conduct.

Sam was convicted of 15 offences of dishonesty and sentenced to eight years’ imprisonment with a non-parole period of five years. He was also permanently banned from providing financial services or from controlling an entity carrying on a financial services business.

ASIC found Sam took advantage of the trust placed in him by his clients. The regulator determined it was appropriate to permanently ban Sam because of the seriousness of his misconduct, the impact on his clients and the need to prevent future harm to consumers.

Sam potentially breached the following standards of the Code of Ethics.

Case study three: Bad advice

The complainants in this case, Christine and Cameron, are corporate trustees of a self-managed superannuation fund. They were clients of financial firm ACME Financial Advice from 22 October 2019 to 4 July 2025.

The complainants believe that the financial firm’s advice was not appropriate for their SMSF during this period. They cited several reasons in their complaint:

• the recommended asset allocation was too aggressive for its conservative members
• it was unnecessary to take on the degree of risk that was recommended to achieve their objectives
• the financial firm was conflicted when it made the recommendations.

The financial firm denied the allegations. Its stated case is that the recommendations were appropriate for the complainants and that it managed any potential conflicts of interest in accordance with its obligations.

AFCA’s investigation found that ACME Financial Advice did not provide appropriate advice to Christine and Cameron, nor did it act in their best interests. The findings noted that ACME Financial Advice:

• failed to provide advice within the risk parameters it set
• failed to diversify the portfolio’s growth assets, with the portfolio too heavily weighted towards property
• recommended an overly high proportion of related entity investments without justification.

AFCA found that the SMSF would have been $252,565 better off had Christine and Cameron not followed the advice provided. Consequently, AFCA’s determination was in favour of the complainants and ACME Financial Advice had to pay the complainants $252,565 compensation plus interest.

By not disclosing required information and misleading the client by omission, ACME Financial Advice potentially breached the following standards in the Code of Ethics:

Case study four: Unethical practice

Gold Coast based financial adviser Dinesh – also a certified practising accountant, registered tax practitioner and self-managed superannuation fund auditor – was a director of ACME Financial Services & related company ACME SMSFs.

Following an ASIC investigation, it is alleged that between March 2018 and August 2024, Dinesh provided unlicensed financial services related to securities, executed unauthorised share trades on client accounts, falsified a fixed-term deposit certificate and misappropriated funds from both personal and SMSF bank accounts belonging to his clients for his benefit or the benefit of third-parties.

As a result of his conduct, it was alleged that Dinesh misappropriated funds totalling nearly $5 million and caused trading losses of approximately $1.25 million.

At the relevant time, Dinesh was authorised by ACME Financial Services Pty Ltd to provide financial product advice regarding retirement savings account products and superannuation. He was charged with two counts of dealing in securities without a licence to do so. The maximum penalty is between two and five years’ imprisonment. He was also charged with breaching each of:

• s1041G Corporations Act 2001, which requires that a person must not, in the course of carrying on a financial services business in this jurisdiction, engage in dishonest conduct in relation to a financial product or financial service.
• s1311 of the Corporations Act 2001 which establishes the general penalty provisions for offences under the Act, creating criminal liability for contravening, or failing to comply with, the Act’s requirements.

Each of these breaches carry a maximum penalty of 15 years’ imprisonment.

Dinesh was also charged with seven counts of dishonestly applying property of another to himself or another, in circumstances where the value of the property has a value of at least $100,000 (aggravated fraud). The maximum penalty for each offence is 20 years’ imprisonment.

In the constantly evolving financial advice landscape, products can be replicated and strategies can be automated, but a culture of trust and integrity remains irreplaceable. Managing an ethics-centred practice is more than a strategy for avoiding risk: it’s an investment in the most valuable asset any firm can manage…your clients and the trust relationship.

An ethics centric practice will benefit from three key synergies:

1. Client retention – because trust creates the strongest bond in any professional relationship, ethical practices hold on to their clients (and grow through referral) whatever is happening in markets.
2. Operational clarity – a shared ethical code simplifies decision-making for staff, as the ‘right’ path and important decision making is defined by values rather than rules.
3. Professional pride – employees are more engaged and productive when they believe in the social value and honesty of their work.

When every member of your team operates with a shared moral compass, a virtuous cycle is created, one where clients feel secure, staff feel empowered and the business achieves a level of resilience that market volatility cannot shake. In this industry, doing the ethical thing is quite literally the best way to do well.

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Notes:
[1] https://www.legislation.gov.au/Details/F2019L00117

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A wake-up call for advisers as ASIC modernises advertising rules, demanding timely, transparent communication in an increasingly digital, fast-moving advice landscape.

ASIC brings financial advertising into the 2020s

Comparing the financial advice profession with the advertising industry is a bit like comparing the Post Office with the Beatles – they are two vastly different worlds that very rarely intersect. However, as readers of AdNews^[1] may have noted, one such intersection point has indeed occurred recently, courtesy of ASIC’s decision to overhaul the regulation of financial services advertising.

In November 2025, ASIC announced^[2] a review of RG234, the primary regulatory instrument governing the advertising of financial services products (including credit). Initially flagged in 2024^[3], the review is an arguably long-overdue refresh of guidance first issued in 2012, before TikTok existed, before the word ‘finfluencer’ was first uttered, and of course before AI search became mainstream.

There are two reasons why this review is significant for financial advisers.

Firstly, this guidance is not just directed at product providers but broadly encompasses every individual or company that is promoting some sort of financial product or service (including financial advice).

Secondly, and critically for advisers, the term ‘advertising’ is not limited to paid placements in traditional or social channels, but more broadly applies to the way financial products and services are represented to consumers in order to influence their behaviour. This brings into scope channels and activities that advisers would consider a normal part of day-to-day business development or client education, including websites, promotional brochures, client seminars and social media posts.

The digitisation of advice continues unabated. According to figures released by Adviser Ratings in late 2025, one in four advice practices are now reliant on digital channels for new client attraction⁴ (up from 16%). And ASIC research released in March 2026 gives us a clear view of the future – finding 63% of Gen Z respondents (aged 18–28) use social media for financial information and guidance, while 30% use YouTube and 18% use AI platforms^[5]. Add to that the shifting landscape of the advice ecosystem – the massive growth in the use of ‘lead generation’ businesses for example – and it becomes clear that for financial regulation to fulfil its primary consumer protection role, it must reflect the ongoing evolution of consumer behaviours and industry structure.

While RG 234 does the heavy lifting in this space, it works in conjunction with other instruments policed by ASIC. In this article, we examine the broader regulatory framework governing financial advertising, summarise the key elements of ASIC’s proposed update to RG234, and consider how common advice-sector marketing practices can be impacted.

The regulatory framework governing financial advertising

Although Regulatory Guide 234 (RG 234) is the primary source of guidance on financial advertising, it sits within a broader framework of legislation and regulatory instruments that collectively govern how financial products and services can be promoted to consumers.

At the highest level, the legal foundation is provided by the Corporations Act 2001, which contains several provisions prohibiting misleading or deceptive conduct and false or misleading representations in relation to financial products and services. Importantly, their application is not confined to traditional forms of advertising. In practice this means that marketing materials, websites, social media posts, seminar presentations and other promotional communications may all fall within scope.

ASIC supplements these statutory provisions with other Regulatory Guides and Information Sheets that explain how the law applies in practice.

The individual components of the framework, and their specific roles, are described below.

• RG 234: Advertising financial products and services^[6]
  The central guide covering advertising and promotional conduct. RG 234 outlines ASIC’s expectation that advertising must be clear, balanced and not misleading, and provides examples of promotional practices that may create misleading impressions for consumers.
• RG 53: The use of past performance in promotional material^[7]
  Provides guidance on the presentation of historical investment performance in marketing materials. ASIC has proposed incorporating this guidance into RG 234 as part of the current consultation, which would consolidate advertising guidance into a single instrument.
• RG 244: Giving information, general advice and scaled advice^[8]
  Clarifies the distinction between factual information, general advice and personal advice. This distinction is particularly relevant where advisers use seminars, webinars or other educational events as part of their marketing activity.
• RG 175: AFS licensing: Financial product advisers – conduct and disclosure^[9]
  Sets out the conduct obligations that apply once advice is provided, including the best interests duty and disclosure requirements. While not an advertising guide, these obligations can become relevant where promotional material creates expectations about the nature or scope of advice services.
• INFO 269: Discussing financial products and services online^[10]
  Provides guidance on the discussion and promotion of financial products through online channels, including social media and the activities of finfluencers.
• INFO 271: How to avoid greenwashing^[11]
  Addresses environmental and sustainability claims made in promotional material and highlights the risk of misleading representations about ESG characteristics.

The multi-faceted nature of this framework reinforces how broadly the definition of advertising is interpreted. In practice, any communication – written, verbal, visible, or virtual – that promotes or influences the uptake of a financial product or service, including advice, may well be captured within its scope.

Changing RG234 to reflect the contemporary advice landscape

ASIC has proposed a number of changes to bring RG234 into the present and make it more adaptive to the future. These proposals were published for industry consultation at the end of 2025^[12].

Many of the changes are structural.  The guide’s title will be simplified, duplicated content removed, and some sections reorganised or condensed. In addition, content that previously appeared throughout the guide will be consolidated into appendices, including a quick reference guide summarising key advertising principles.

A substantive change is the proposal to incorporate guidance from RG 53 on the use of past performance in promotional material into the updated RG 234. If implemented, this change would result in RG 53 being withdrawn, with performance advertising guidance contained within a single consolidated guide.

The revised guide will also introduce several new examples drawn from relevant ASIC regulatory and enforcement actions. These examples relate to issues such as the presentation of returns, disclosure of risks, the use of disclaimers, comparisons between financial products and the calculation and presentation of past performance.

Finally, the proposed update recognises and offers guidance around contemporary marketing channels. References to digital promotion, social media and online advertising have been incorporated into the guide, and the growing finfluencer sector is also acknowledged.

Industry response

As expected, the proposed update has also prompted a strong response from industry stakeholders, including associations and product providers. A common theme in these submissions is the need for greater clarity around the application of existing advertising obligations in a digital environment.  ASFA’s submission^[13] for example pointed to the need for further guidance expressly around search engines, social media, streaming, podcasts, influencer-distributed content, comparison sites, and interactive tools.

The FSC^[14] called for the definition of ‘promoters’ to be extended to the growing cohort of lead generation businesses.

There have also been calls for more specific guidance on issues such as the use of past performance, the treatment of short-form content and how key disclosures should be presented where space is constrained.

Distilling ASIC’s guidance into core principles

While RG 234 and related guidance span multiple regulatory instruments, the underlying expectations can be distilled into a small number of core principles. Developing an understanding of these principles can be an important first line of defence for advisers seeking to ensure their marketing activities are compliant.

First, promotional material must not create a misleading overall impression. This is the central test applied by ASIC, and it extends beyond the accuracy of individual statements to the way information is framed and understood by the target audience.

Secondly, important information must be clear and prominent from the outset. Key risks, conditions or limitations should not be hidden in fine print, nor introduced via links to other materials, or later disclosures.

Finally, advertising should present a balanced view of benefits and risks. Messaging that highlights potential advantages without giving appropriate visibility to limitations may create unrealistic expectations for consumers.

A word about disclaimers

The nature of disclaimers, including their size and location, is clearly central to ASIC’s guidance, and indeed the existing version of RG 234 already provides clarification around the treatment of disclaimers in ‘audio and visual’ channels^[15]. While the nature of multimedia channels has evolved significantly, the spirit of that guidance remains clear and relevant in a digital world:

“[Disclaimers] should also have sufficient prominence to effectively convey key information to a reasonable member of the audience on first viewing of the advertisement. Information is less likely to be noticed and understood if it is in fine print, contained within a dense block of text, only shown on television or a computer screen for a brief period, or placed where there is distracting content shown simultaneously.”

Guidelines in action: lead generation funnels

Digital lead generation has become one of the fastest growing client acquisition channels in the advice sector. Consumers are commonly drawn into these funnels through ‘clickbait’ advertising offering such services such as a ‘free super health check’, a lost super search or a retirement readiness quiz. In reality, these services are often little more than a façade for sophisticated lead-harvesting operations.

This business model has, unsurprisingly, attracted significant regulatory attention, and recent ASIC investigations have uncovered numerous examples of third-party marketing firms being paid substantial fees to generate leads through high-pressure online advertising (and follow-up cold calling). In response, in early 2026 ASIC publicly warned consumers^[16] about these tactics in relation to superannuation switching, at the same time announcing a review into – and publishing a list of – advice licensees that rely on lead generation services^[17].

While there remains debate about whether these firms are subject to RG234, they are still subject to the general misleading or deceptive conduct provisions of the Corporations Act, and ASIC’s main concern with the advertising used by these businesses is centred around a lack of transparency, and the overall impression their advertising creates. Messaging that appears to offer independent assistance or a neutral financial ‘health check’ may actually be the first step in a sales funnel designed to direct consumers toward a particular advice provider or financial product.

Even where the underlying claims in the advertisement are technically accurate, the promotional framing may still be misleading if the true commercial purpose of the interaction is not clear to consumers.

Guidelines in action: education as a marketing tactic

Educational marketing has become a common – and successful – business development strategy for many advice practices. Client seminars, webinars and downloadable eBooks allow advisers to help consumers understand complex financial issues such as superannuation or estate planning, while also building a targeted pipeline of prospects.

But as always, when it comes to promoting these resources or events, emphasis and context matter.

Consider the advertising of a webinar on Transition to Retirement (TTR) strategies. Promotional material for the event would likely highlight the potential tax advantages and cash flow benefits of implementing a TTR pension while continuing to work. For many pre-retirees, TTR can indeed be a very powerful and beneficial strategy.

But while these statements may be technically correct, they can be problematic if the benefits of the strategy receive far greater prominence than important qualifications. For example, a TTR strategy will not be appropriate for all clients, and its effectiveness is dependent on specific eligibility and contribution settings.

From a regulatory perspective, ASIC is likely to consider whether important information about risks, limitations or eligibility requirements is presented clearly in the promotion of the webinar. If these elements appear only briefly or are buried in fine print, the overall message may be considered misleading. Just as importantly, it doesn’t matter that processes to qualify prospects may exist further down the line (e.g. at the webinar itself) – ASIC will judge the advertising on its own merits.

As para 51 of RG 234 stipulates:

“If a qualification is required, it must be published at the same time as the original message. Subsequent qualifying disclosures will not be effective as the misleading impression will already have been created.”^[18]

Guidelines in action: social media

Social media has become an increasingly popular communication and marketing channel for advisers. Short-form content such as videos, posts or infographics – discussing financial markets, tax tips, and investment strategies – can be an effective way to engage audiences and build authority.

However, the short attention span of viewers, the cluttered online environment, and the tight size limitations of these channels, generally dictates that messaging be short and impactful. A social media post promoting SMSFs as a way to purchase property is already tapping into a powerful psychological force (our love of bricks and mortar) and so can easily be both brief and effective. But while that’s perfect for social channels, it runs the risk of giving insufficient focus to the considerable risks and limitations associated with this strategy, such as borrowing constraints, liquidity considerations and concentration risk.

Again, downstream disclosures or qualifying processes are irrelevant – ASIC will judge the initial promotion on its own merits, and the brevity dictated by social media formats will not be seen as an excuse to de-emphasise any risks and/or limitations.

Practical takeaways for advisers

While it may be understandable that some AFSLs see marketing activities as sitting outside the formal compliance framework applied to advice itself, the recent regulatory focus on financial advertising suggests that this separation is becoming increasingly difficult to justify. Readers of this article should familiarise themselves with the various guidelines and instruments listed earlier in this article, as well as noting the following key takeaways that can help ensure the broad suite of activities conducted under the marketing umbrella are done so in a compliant way:

1. Remember that the definition of ‘advertising’ is broad, and brings into scope websites, promotional brochures, client seminars and social media posts. As such, undertake a structured review of all such materials through the lens of RG 234.
2. Continually treat promotional material with the same discipline applied to advice documentation. Marketing messages should be reviewed with the same mindset used when assessing client communication and advice documents. The key question is not simply whether statements are technically accurate, but how the intended audience would interpret the statements on first sighting.
3. Ensure a balanced presentation of benefits and qualifications. Promotional material that emphasises the benefits of a strategy, such as tax advantages or investment returns, should ensure that important qualifications are presented clearly and in close proximity to those claims.
4. If using lead generation services or referral partners, review the way these partners present your services to prospects. Advisers should ensure the messaging used by those partners is accurate and meets the same standards expected of the practice itself.
5. Recognise that brevity is not a regulatory defence. Content on websites, or promoted through social media or digital advertising, may be short form through necessity, but the constraints of the channel do not reduce the obligation to present information in a compliant manner.

Conclusion

ASIC’s review of RG 234 does more than modernise a decade-old regulatory guide, it shines a spotlight on the full breadth of obligations that already apply to the way financial products and advice services are promoted. To the extent this framework captures activities traditionally viewed as ‘business development’ or ‘client education’ – rather than marketing – the review may serve as a timely wakeup call.

As ASIC moves towards implementing the revised standards later in 2026, advisers would be well served to treat marketing communication as a core compliance focus rather than a peripheral activity. Reviewing websites, seminar content, social media posts and third-party lead generation arrangements through the lens of RG 234 should not be a theoretical exercise, but rather a practical step in preparing for a regulatory environment where the first impression created by a promotional message will be subject to the same scrutiny as the advice that follows.

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References:
[1] https://www.adnews.com.au/news/asic-edges-closer-to-new-rules-for-financial-advertising
[2] https://www.asic.gov.au/about-asic/news-centre/news-items/asic-proposes-updates-to-guidance-on-advertising-financial-products-and-services/
[3] https://www.asic.gov.au/about-asic/news-centre/news-items/asic-update-on-maintenance-of-regulatory-guides/
[4] https://www.adviserratings.com.au/news/from-compliance-to-cool-how-smart-advisers-beat-finfluencers-at-their-own-game/
[5] https://www.asic.gov.au/about-asic/news-centre/find-a-media-release/2026-releases/26-049mr-asic-urges-gen-z-to-sense-check-money-advice-as-social-media-fuels-riskier-financial-decisions/#:~:text=(26%2D049MR)-,ASIC%20urges%20Gen%20Z%20to%20’sense%2Dcheck’%20money%20advice,turn%20to%20family%20and%20friends.
[5] https://download.asic.gov.au/media/rkzj5nxb/rg234-published-15-november-2012-20211008.pdf
[6] https://download.asic.gov.au/media/1238984/rg53.pdf
[7] https://download.asic.gov.au/media/tkqi11il/rg244-published-13-december-2012-20211208.pdf
[8] https://download.asic.gov.au/media/pqpe0hwc/rg175-published-21-november-2024-20241219.pdf
[10] https://www.asic.gov.au/regulatory-resources/financial-services/giving-financial-product-advice/discussing-financial-products-and-services-online/
[11] https://www.asic.gov.au/regulatory-resources/financial-services/how-to-avoid-greenwashing-when-offering-or-promoting-sustainability-related-products/
[12] https://www.asic.gov.au/regulatory-resources/find-a-document/consultations/cs-37-proposed-update-to-asic-s-guidance-on-advertising-financial-products-and-services/
[13] https://financialnewswire.com.au/superannuation/super-funds-seek-standardised-10-year-past-performance/
[14] https://www.professionalplanner.com.au/2026/01/include-lead-generators-in-advertising-guidance-fsc/
[15] https://download.asic.gov.au/media/rkzj5nxb/rg234-published-15-november-2012-20211008.pdf
[16] https://www.abc.net.au/news/2026-02-18/asic-announces-review-into-lead-generators-superannuation/106353740
[17] https://www.moneymanagement.com.au/143800-2/
[18] https://download.asic.gov.au/media/rkzj5nxb/rg234-published-15-november-2012-20211008.pdf

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