Announcements

FASEA Releases Code of Ethics Guidance

Oct 18, 2019

MEDIA RELEASE

In 2017 the Commonwealth Parliament amended the Corporations Act 2001 (“the Act”) to raise the education, training and ethical standards of licensed financial advisers in Australia.

Under the Act, FASEA was declared the standards body and charged with responsibility for implementing the legislative amendments. This included making the sole, compulsory Code of Ethics that is applicable to the conduct of all advisers who provide financial services to retail clients.

The making of the Code and changes to education and training standards, reflect community expectations that the provision of professional advice be centred on serving the best interests of the client free from any conflict.

FASEA’s efforts have been targeted at realising this expectation within the context of the Act. To that end and following extensive consultation with key stakeholders, the Code of Ethics was made in February, 2019.

Compliance with the Code which comprises five (5) values and twelve (12) Standards will come into effect on 1 January 2020. (link).

The Code has been designed to encourage and embed higher standards of behaviour and professionalism in the financial advice industry. As such, it establishes ethical duties that go beyond the minimum requirements of existing law. It should be noted that, as a legislative instrument, the Code has the force of law.

The implementation of industry-wide higher educational, training and ethical requirements will require a universal effort over the coming years. FASEA considers that this effort is worth making – not least in the area of professional ethics. The reward for doing so will be an increase in public trust and confidence in this evolving profession.

To assist stakeholders in understanding, interpreting and applying the Code, FASEA is releasing a Code of Ethics guide (FG002 Code of Ethics Guidance).

The guide includes case study examples. Their purpose is to aid understanding of the requirements of the Code. The Code is a living document and subject to change, as required. It is principles-based and is intended to apply to a wide range of situations. All of the formal obligations lie in the language of the Code – not the guidance document which is illustrative rather than conclusive in its guidance. As with all professions, advisers are ultimately responsible for exercising judgement in the application of the Code.  

FASEA will host a series of consultation briefing sessions with a number of educational, professional, consumer and industry stakeholders. The purpose of these sessions is to provide opportunity for consultation on the practical elements of the Code, and to communicate and explain the integrated nature of the Code.

The Financial Adviser Standards and Ethics Authority Limited was established in 2017 to set the education, training and ethical standards of financial advisers in Australia.

 

 

The Financial Adviser Standards and Ethics Authority Limited was established in 2017 to set the education, training and ethical standards of financial advisers in Australia.