Market disruption, reputation damage, and financial performance are the main risks to the superannuation and investment industry, according to a survey.
The survey by Riskwise Professionals and SUPER Recruiters found these risks were followed by cybercrime, and regulations.
SUPER Recruiters principal, Guy McKanna said: “Reputation damage is often typically caused through front line staff not having clear unambiguous instructions, training, and understanding of product disclosure requirements and superannuation rules”.
“This is particularly relevant given the high profile cases of inappropriate advice ascribed to predominantly bank-owned or franchised distribution channels,” he said.
“As management should know well and truly by now, embedding a proactive culture of risk goes a long way to lifting the game. Improving an organisation’s culture of appropriate selling practices should be high on their agenda.”
The survey also found respondents thought that engaging with external consultants would be the best way to prepare for risks.
“The strong response for accessing external expertise would suggest that organisations are not solely comfortable with their current level of risk preparedness and/or the frameworks under which they operate,” McKanna said.
Respondents also said that building stronger controls into investment processes, in particular automating processing technology, would help better identify risks.