by Susan Edmunds
Adviser Martin Hawes was one of three new members of the Code Committee announced last week.
He and Stephen O’Connor join legal and financial services governance expert, Melanie Biss, as new members.
The existing members are Ross Butler, Shane Edmond, Professor Dimity Kingsford-Smith, David Russell and Gary Young, led by chair David Ireland.
Butler, Edmond and Kingsford-Smith agreed to extend the duration of their terms.
Committee member Michael Staal stood down from the Code Committee at the end of his term.
Hawes said the industry was at a pivotal time. “We’ve had regulation for almost four years. The wide-ranging review of the FAA could be really useful. The timing is about right. We’ve had some complaints [about regulation] but in many respects it seems to have bedded down quite well. I have an open mind regarding the way forward.”
He said he thought the Code of Conduct for Financial Advisers was good, particularly code standard one, which requires advisers to put their clients’ needs first. “When that is adopted fully by the industry it will change it from an industry to a profession. It’s always been my definition of a profession when the client comes before the adviser.”
He said AFAs had taken regulation seriously. “Where I am not sure about things is the position of RFAs. I’ve had very little experience of that. What’s going on in that space, I’m not sure.”
Publicity about David Ross shortly after regulation was introduced had set the industry back in the eyes of the public, Hawes said. “Just when the public might have been starting to get confidence in financial advisers, that comes along.”
The industry was in a much better place than it was pre-regulation, Hawes said. “Whatever teething difficulties might be identified, we’re in a lot better space. There’s work to do informing the public of what’s gone on. Those in the industry are very involved and assume everyone knows what is happening but the general public don’t know about it. They know regulation has happened but my very small sampling would suggest the public doesn’t really know what regulation is about.”
It was also difficult for people with modest means to access advice. “The person who’s paid off their mortgage and has $50,000 in cash put aside might really struggle to get advice. From the bank would be okay but they might not be able to get it more widely.”
Hawes said he was approaching the FAA review with an open mind but with an optimistic outlook. “The world is not going to sit still, there will be ongoing change to financial adviser regulation, it’s always going to happen and so it should – it’s one of those things you can continue to improve.”
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