Superannuation fund trustees should be subjected to naming and shaming if they fail to comply with the code of conduct attaching to insurance within superannuation, according to the Financial Planning Association (FPA)
Responding to the Insurance in Superannuation Working Group (ISWG) consultation paper dealing with the proposed code practice, the FPA suggested that one Express.and then the superannuatiooption was to ensure that the Australian Securities and Investments Commission (ASIC) required all trustees who are Australian Financial Services licensees to be subject to an ASIC-approved code of practice.
It further suggested that ASIC impose the requirement as a condition of license.
However, the FPA cautioned against seeking regulatory intervention in circumstances where a large number of trustees were voluntarily subscribing to the code anyway.
“Instead, trustees could promote their subscription to the Code and the benefits it brings,” it said. “Further, a credible threat of sanction (including publicly naming and shaming funds that breach the Code) by the independent code administrator would promote compliance with the code behaviour and build public trust in entities bound by the Code.”
