The FMA today published its Annual Corporate Plan (ACP), which outlines its work plan for the next financial year and sets objectives for raising standards of behaviour across financial services.
The development of the 2019-20 ACP is based on a new sector-based approach that is set out in the FMA’s refreshed Strategic Risk Outlook (SRO), also published today.
The SRO provides our medium-term view of the most significant risks, as well as the major opportunities and challenges, to deliver the FMA’s mission of fair, efficient and transparent financial markets. These documents also describe our expectations of how firms need to serve the needs of their customers.
Rob Everett, Chief Executive at the FMA, said: “We have introduced a sector-based approach to provide a clear indication to stakeholders of the priority risks we want to address and the activities we will undertake to achieve our goals in the specific sectors we regulate. Our new approach reflects the maturity of the Financial Markets Conduct Act regime and our broadening focus on the treatment of investors and customers.”
The sector approach is focused on:
- Capital Markets
- Investment Management
- Sales, Advice and Distribution
- Banking and Insurance.
The FMA’s refreshed approach has resulted in the FMA updating its strategic priorities, these are:
- governance culture, systems and controls
- credible deterrence of misconduct
- successful implementation of potential remit changes
- investor and customer decision-making
- promoting trust and confidence in capital markets.
These priorities provide a blueprint for what will guide our decision-making and focus our activity in the coming year. Longer-term opportunities and challenges include significant regulatory and legislative changes, impacts of innovation and climate change and the value for money of financial products. As well as changing macro-economic conditions, the emergence and development of conduct regulation internationally, and challenges to trust and confidence, highlighted through the Australian Royal Commission.
Mr Everett noted the implementation of the new regime for financial advisers as a significant piece of work in the year ahead. “We will also work closely with the Government and industry to prepare for and implement any changes to the conduct regulation regime for banks and insurers.”
“Our ongoing work with the Reserve Bank of New Zealand on the conduct and culture reviews of the banking and life insurance sectors reflects our overall objective to improve standards of behaviour and ensure all providers are serving the needs of their customers.
“We expect all market participants to review the risks we’ve identified in the sectors that impact them, assess the relevance of these risks, and what they are doing to mitigate them. Market participants should not be waiting for legislative changes, or the regulator to come knocking, to do the right thing,” Mr Everett said.
Documents published here: