Policy response to the Hayne Royal Commission
As the professional body for the investment management industry in Australia, CFA Societies Australia and CFA Institute share a mission to promote the highest standards of ethics, education and professional excellence in the investment management profession, for the ultimate benefit of society.
The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (Hayne Royal Commission) has shone a spotlight on many areas of financial services where the rights of investors have been compromised. We are therefore advocating for policy changes to firmly address this issue in line with our mission.
It is imperative that decisive, visible actions are taken to restore public trust and confidence. We believe that policy needs to focus on several key areas to improve the outcomes for clients of financial advice firms. These include strengthening best interest duty and ensuring appropriate consequences; outlawing conflicted remuneration practices; ensuring independence of advice; and the professionalisation of the financial advice industry.
These changes will improve the public perception of the industry, allow more equitable fees for services provided and help to deliver better outcomes for the investing public. These changes together go to the heart of the culture we have seen to be operating in parts of the industry – bringing together regulation, systems and behaviours to create a stronger and fairer financial services sector.
Our response to the Hayne Royal Commission is informed by the views of senior industry participants and CFA charterholders working across the investment management industry, including members of the national Advocacy Council. It reviews the findings of the many previous formal reviews into the sector and the lack of meaningful and effective change that followed those reports.