ASIC has released its corporate plan for 2018–19 to 2021–22 and it includes a focus on poor culture and professionalism in financial services.
In the financial year ahead, ASIC has said it will focus particularly in the provision of consumer credit and financial advice, the fair treatment of small business and the use of consumer data by firms.
ASIC chairman James Shipton said in the report that the industry was facing unprecedented scrutiny and needed to change.
“As a starting point to establishing trust, individuals, firms and industry need to improve their conduct by demonstrating greater levels of professionalism.
“Culture change and better governance are also vital. Firms need to ensure they adopt a culture of professionalism and make sure it is cascaded through the entire form and sector,” he said.
Mr Shipton said the ASIC was a core part of the system and they would continue to work with the government in driving the behaviours that will build trust.
“We will continue to work with government on the significant upgrade to ASIC’s enforcement powers and penalties and the proposed financial product governance obligations and intervention powers,” Mr Shipton said.
The ASIC corporate plan said it would set and revise the standards like the banking code of practice and monitor their adoption in companies.
The plan also committed to identifying the most significant harms to consumers, investors and markets and take regulatory action when misconduct occurs.
ASIC commissioner John Price said that small business would also be focused on as they were an important stakeholder for the regulator.
“Small businesses employ half of Australia’s workforce and make up one-fifth of Australia’s gross domestic product so it’s vital that ASIC helps create an environment that develops the small business sector,” he said.
ASIC will review lender’s compliance with small business protections in unfair contract term legislation and offer tools and resources to small businesses.
The regulator will also work with small businesses to ensure compliance, in particular, stopping illegal phoenix behaviour, non-compliance with financial reporting obligations and director misconduct.
Since launching its Small Business Strategy in 2017 ASIC has reported more than 366,00 new business names and has prosecuted 382 entities/individuals for 734 offences relating to failure to keep books and records.