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Dr. Mark Sinclair
Dr. Mark Sinclair, Mentor Education

ASIC Serious About Culture Of Compliance

22 July 2013

ASIC has indicated that it is serious about tracking down FOFA non-compliance, warning against just “ticking boxes” with deputy chairman Peter Kell commenting in the Australian that, “financial services organisations need to develop a deep culture of compliance led by senior management.”

Commenting in light of the newly activated FOFA reforms Kell has stressed adamantly the importance of a sustainable compliance system saying that “a compliance system that is simply treated as an add-on required by law ultimately will be useless.”

As the deputy chairman of ASIC Kell has reviewed dozens of organisations every year and has suggested that if becomes “clear very quickly if they have a poor compliance culture”. He added that, “those with a dodgy culture exhibit a lack of management oversight or, in the worst cases, wilful blindness to failings. Having a folder full of policies and procedures is just mere window-dressing if they are not lived and breathed and not policed for effectiveness.”

Mr Kell said the ultimate yardstick of a sound compliance culture was the “quality of advice” offered by a practitioner or firm, stating that ASIC will be holding executives to account for insufficient advice given to their staff. “If non-compliance is tolerated, even implicitly, it is a strong sign the culture is weak,” he said.

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