Advisers don’t want to be ‘guinea pigs’: FAAA
The Financial Advice Association Australia (FAAA) is calling for regulators to take a partnership approach with financial advisers regarding incoming legislation.
Reforming advice documentation is one of the key issues the association has long called for, evident in its submission for Tranche 2A of the Delivering Better Financial Outcomes (DBFO) draft legislation.
To achieve effective change with advice documentation and other issues plaguing advisers more broadly, the FAAA said the industry should be “deeply involved” in developing new guidance with the government.
“We recommend that ourselves, ASIC and licensees be deeply involved in developing guidance, on which licensees and advisers can confidently rely,” the submission said.
Unpacking this further on a recent FAAA webinar, CEO Sarah Abood said advisers do not want to be treated as test subjects for new legislative change coming through.
“Giving everyone the confidence to move is something we’ve addressed in the [submission] document as well, that nobody wants to be the guinea pig or the test case for someone to decide whether a particular change is appropriate or not,” she said.
“It’s much more of a partnership approach that we would love to see, recognising that the vast majority of advisers just want to comply. They don’t want to produce 80 or 100 page documents, they would love to be able to produce a much more client-friendly, simpler document, so we need to address all the reasons why that’s not the case.”
Also appearing on the webinar, FAAA chair David Sharpe said many advisers have been negatively impacted by years of over-regulation in the past, which the association is attempting to dismantle through a “financial services razor-gang” to cut red tape.
“A lot of advisers have this scarring of overregulation for many years. Even if the legislation frees it up, there will be fear to move. It’s like the buffalo crossing the river in case they get hit by the crocodile on the way through,” Sharpe said.
Another major recommendation in the FAAA’s DBFO submission was to recognise the professional judgement of advisers, rather than following “prescriptive and restrictive regulatory checklists”.
Addressing this, Sharpe said acknowledging the professional judgement of advisers is “baseline respect” given the ongoing professionalisation of the industry.
He added: “The professional judgement piece [is] almost baseline respect for the work that advisers have undertaken. We are educated, we have a code of ethics, we are examined, and we all have the minimum level of experience – all the hallmarks of a profession, we now have. What we’re asking for is the respect that then brings, not the micromanagement of every step of what we do.”
AUTHOR
Jasmine Siljic
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