Quality of Advice Review
10 June 2022
The Law Council of Australia welcomes the opportunity to make a submission to the Quality of Advice Review (Review) in response to the Issues Paper published in March 2022. This submission has been prepared by the Financial Services Committee of the Business Law Section (FS Committee) and the Superannuation Committee of the Legal Practice Section (Superannuation Committee) (collectively, the Committees).
Responses to specific questions
In the Annexure, responses of the FS Committee and the Superannuation Committee to some of the questions in the Issues Paper have been provided. The Committees have only sought to respond to those questions covering topics of which members have relevant knowledge and experience and feel that they are well placed to provide a meaningful response. The Committees have not sought to respond to questions relating to non-legal matters such as estimated business costs.
Additional observations of the FS Committee
The FS Committee also notes that there have been a number of developments which have raised professional standards for the financial advice industry, such as requirements to hold degree qualifications, pass compulsory examinations and comply with a code of ethics. In light of these changes, the FS Committee submits that it would be reasonable to assume that those who have met this higher bar in order to enter, or remain, in the industry are capable of exercising a certain amount of independent professional judgment. The FS Committee submits that, as the professional standards in the industry have evolved, some thought should be given as to whether the regulatory approach should also similarly evolve – in particular, whether obligations should be more principles-based and less “boxticking” in nature, so as to allow advisers to exercise their professional judgment and tailor their approach to presenting advice with a view to making it more user friendly and client focused.