The Association of Financial Advisers (AFA) will be asking its members to vote on a new, updated constitution as the association prepares to become a code monitoring body as part of the new incoming professional standards.
Speaking at a media briefing at the 2017 AFA National Adviser Conference at the Gold Coast, AFA national president, Marc Bineham said the constitution was created 20 years ago and it needed to be updated to bring it in line with best practice in light of the new professional standards.
“By 1 January 2020, there will be the code that will come out that associations that want to be professional bodies will need to abide by and part of that will be ASIC [Australian Securities and Investments Commission] will come looking under the hood and the first thing they’ll look at is the constitution. And so, it does need to stack up to scrutiny as part of best practice,” Bineham said.
“If we do it at this AGM it’ll be another 12 months at the next AGM and that will leave us 14 months for whatever else we needed to get done.”
Bineham, however, emphasised that while the constitution had been updated, it was not tailored to the new professional standards as uncertainty still lingered around the finer details of the educational requirements.
The industry was awaiting details of the framework from the Financial Adviser Standards and Ethics Authority (FASEA).
“We know we just needed to modernise but the actual finer detail, they haven’t even decided what that’s going to be so it’s a bit of an unknown unfortunately. So, we just want to get our house in order to be in line with best practice,” Bineham said.
“Then we’ll adapt when we know what the requirements are.”
While governance for the professional standards through the constitution would dominate the AGM, the AFA would also re-visit the terms of the AFA board members, with association members saying they wanted to see three-year terms rather than two-year terms.
But Bineham said that because board members were small business people and committing three years would be difficult, they had proposed to do two lots of two-year terms, with board members allowed the option of standing for re-election if they wished.