ASIC seeks views on overhaul to conflicts management guidance
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The news: The Australian Securities and Investments Commission (ASIC) has released proposed updates to its conflicts management guidance for financial services businesses.
The numbers: ASIC is taking feedback on proposed changes to the guidance, which hasn't been updated in 2004, until 5 September.
The context: The new changes are aimed at aligning the guidance with recent developments in law and policy, the regulator said. The overhaul is focused on "stronger, more tailored" conflict management to help avoid consumer and investor harm, informed by the way financial services have evolved over the last two decades.
The updated guidance sets out how Australian financial services (AFS) licensees should comply with their conflicts management obligation and explains:
- how the law applies, including its scope and interaction with other related obligations;
- the types of conflicts AFS licensees need to identify and manage to meet their obligation;
- the need to have robust and tailored arrangements that are adequate to manage conflicts; and
- how licensees can effectively manage conflicts.
The updated guidance includes a roadmap that sign-posts other related conflicts management obligations that AFS licensees need to be aware of.
What they said: "Conflicts management is a core obligation for financial services businesses and helps promote consumer protection and market credibility," said ASIC commissioner Kate O'Rourke.
"Conflicts of interest are more than mere moral dilemmas. They can undermine trust, integrity and performance, causing serious harm to consumers, investors and overall market confidence."
The source: ASIC media release
