|        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Friday, July 23rd, 7:18PM


Latest Headlines

Code of conduct launched amid warnings for industry

A new code of conduct for the financial services sector has been launched, but the FMA is asking why it took so long to get there.

Thursday, September 6th 2018, 6:00AM 3 Comments

by Susan Edmunds

The Financial Services Code, which takes effect on January 1, has been in development for two years.

It is designed to sit alongside and complement existing regulation and laws, and has nine standards which fall into three core objectives covering ethical, communication and consumer outcomes.

If there is a material breach of the code, there are a number of sanctions and penalties that an Independent Disciplinary Committee can impose on a member, including fines of up to $100,000 and termination of FSC membership.

FSC chief executive Richard Klipin said it was primarily about putting customers first.

“We want to ensure our members are putting the interests of consumers front and centre and delivering the best outcomes for New Zealanders. While we recognise there is still plenty of work to do, with the launch of this Code of Conduct the industry is putting a stake in the ground.”

FSC chairman Rob Flannagan said the code showed the depth and power possible from the industry when people worked collaboratively.

He said it had been “amazing” to watch the process as representatives from the sector developed it.

“People would come in wearing the badge of who they work for then have been challenged on what’s best for the industry, [we’ve seen] how they’ve moulded and changed and seen things from different perspectives. Everyone saw what was right for the industry as opposed to their particular tunnel that most of us have been trapped in for many years. That’s just been a huge success.”

He said the industry was restricted by the Commerce Commission – it couldn’t agree as an industry to make wholesale changes to the way it operated. But it could come up with vest practice guidelines that would put the industry on a continuous improvement cycle.

Good customer outcomes made good business sense, he said but were also the right thing to do for New Zealanders and the country as a whole.

ANZ’s Ana-Marie Lockyer, co-chair of the code governance group, said the code would not remain stagnant. “What’s acceptable today may not be acceptable tomorrow. It’s important to test and challenge it as an industry.”

Financial Markets Authority chief executive Rob Everett welcomed the code. But he said the amount of work it took to get it together “might say something about leadership in financial services and some of the uncertainty at the top of New Zealand firms about what heir role is in that respect.”

He said scandals such as those uncovered by Australia’s Royal Commission were detrimental to the industry and an affront to people who had spent their careers in financial services.

The damage done must not be underestimated, especially to consumer trust, he said.

“Some of that damage is being felt here.”

But he said New Zealand had the opportunity to get ahead of it, if providers could show they were adapting and responding to customer needs. Those who did not adapt swiftly to change risked losing customer trust – and were more likely to face the intervention of politicians.

Code standards
1 Members must carry out business professionally, with due care, competence and skill, and act with integrity. They must behave in a way that promotes public confidence in the financial services industry.
2 Members must communicate with customers clearly and effectively.
3 Members must make reasonable efforts to ensure that customers are provided with sufficient information to enable them to make informed decisions about product and services.
4 Members must seek and consider customer feedback.
5 Members must design and distribute products responsibly.
6 Members must provide employees and distribution channel personnel with appropriate training.
7 Members must maintain appropriate internal processes for explaining the risks to a customer of replacing or retaining an existing product or service.
8 Members must manage conflicts of interest fairly and in a way that promotes good customer outcomes.
9 Members must treat customers fairly.


« Former Generate man taps into new service for advisersBank advice criticised »

Special Offers

Comments from our readers

On 6 September 2018 at 6:58 am Murray Weatherston said:
Rob Everett has a good point. How come 132 words of AP&M (apple pie and motherhood) took 2 years?
On 6 September 2018 at 8:45 am Brent Sheather said:
Have to agree. What a load of waffle. Looks like business as usual – more unsatisfactory outcomes for retail investors.
On 6 September 2018 at 11:16 am gavin austin adviser business compliance said:
These Code Standards have a very familiar ring to them ( AFA code ) -agree with previous commentators especially when considering the similarity with AFA codes. Maybe they finally decided that what AFAs have to do is a great way to go - wow.

Sign In to add your comment



Printable version  


Email to a friend
News Bites
Latest Comments
  • Underwriting delays for nib special offer
    “I have a significant objection to a point in this communication, and I have raised it with nib directly. "In future, please...”
    21 hours ago by JPHale
  • Cryptocurrency; Advisers wary but must evolve
    “Financial services getting into crypto right now has the typical feeling of the mum and dad investor jumping in. FOMO is...”
    2 days ago by JPHale
  • FMA report slams insurers
    “There's a gap, alright. However, the mainstream media has missed what Matthew pointed out here, the real impact on the consumer...”
    2 days ago by JPHale
  • FMA report slams insurers
    “@Murray If 95% of legitimate well established and capable business did not meet expectations, might the age old saying "they...”
    2 days ago by LNF
  • FMA report slams insurers
    “Meanwhile, in the real world, advisers are still trying to secure PI cover by the end of the month so they can remain in...”
    2 days ago by Adviser1
Subscribe Now

Weekly Wrap

Previous News


Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 2.55 2.95 3.29
ANZ 4.44 3.10 3.50 3.84
ANZ Blueprint to Build 1.68 - - -
ANZ Special - 2.50 2.90 3.24
ASB Back My Build 1.79 - - -
ASB Bank 4.45 2.55 2.95 3.29
Basecorp Finance 5.49 - - -
Bluestone 3.49 3.34 2.99 3.34
BNZ - Classic - 2.55 2.95 3.25
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Std, FlyBuys 4.55 3.15 3.22 3.85
BNZ - TotalMoney 4.55 - - -
CFML Loans 4.95 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.95 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland Bank - Online 1.95 1.85 2.35 2.45
Heretaunga Building Society 4.99 3.80 3.90 -
Lender Flt 1yr 2yr 3yr
HSBC Premier 4.49 2.19 2.45 2.69
HSBC Premier LVR > 80% - - - -
HSBC Special - 2.25 - -
ICBC 3.69 2.15 2.35 2.75
Kainga Ora 4.43 2.67 2.97 3.13
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.75 3.34 3.34 4.14
Kiwibank - Offset 3.75 - - -
Kiwibank Special 3.75 2.49 2.49 3.29
Liberty 5.69 - - -
Nelson Building Society 4.95 2.99 3.24 -
Lender Flt 1yr 2yr 3yr
Pepper Essential 4.79 - - -
Resimac 3.39 2.98 2.79 3.29
SBS Bank 4.54 2.69 2.99 3.29
SBS Bank Special - 2.19 2.49 2.79
Select Home Loans 3.49 3.34 2.99 3.34
The Co-operative Bank - First Home Special - ▲2.29 - -
The Co-operative Bank - Owner Occ 4.40 ▲2.49 ▲2.89 ▲3.19
The Co-operative Bank - Standard 4.40 ▲2.99 ▲3.39 ▲3.69
TSB Bank 5.34 ▲3.30 ▲3.69 ▲4.04
TSB Special 4.54 ▲2.50 ▲2.89 ▲3.24
Wairarapa Building Society 4.99 3.55 3.49 -
Lender Flt 1yr 2yr 3yr
Westpac 4.59 3.15 3.49 3.89
Westpac - Offset 4.59 - - -
Westpac Special - 2.55 2.89 3.29
Median 4.54 2.68 2.99 3.29

Last updated: 19 July 2021 9:09am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
Site by Web Developer and