Code: From complex to simple

That’s the verdict after the group released its first full consultation draft.

The new code, which will apply to all financial advises under the new regime, has 12 standards:

• Treat clients fairly and act in their interests
• Act with integrity
• Manage conflicts of interest
• Take reasonable steps to ensure the client understands the financial advice
• Give financial advice that is suitable for the client
• Protect client information
• Resolve complaints
• Not bring the financial advice industry into dispute
• Have general competence knowledge and skill
• Keep competence, knowledge and skill up-to-date
• Have particular competence, knowledge and skill for designing an investment plan
• Have particular competence, knowledge, and skill for other types of financial advice

The code introduces a minimum level five certificate qualification requirement for all advisers, and requires them to have completed the relevant certificate strands for the type of advice they offer, such as insurance, investment or mortgage advice. If they provide more than one type, they will need to have completed more than one specialist strand.

Financial Advice New Zealand chief executive Katrina Shanks welcomed the code. “For us it’s fantastic that the code has at last been released. It gives some certainty in the marketplace of what the draft code looks like.”