The financial advice industry is part way through transformation from an industry dedicated to the sale of financial products to a profession concerned with the provision of financial advice. The interests of Australians who seek financial advice require that that transformation be completed. That will not be an easy task, but it is necessary. It will require:
- taking steps to deal with those involved in the charging of ‘fees for no service’, and to ensure that it does not happen again;
- reducing the conflicts of interest that pervade the industry; and
- introducing a credible and coherent disciplinary system for financial advisers.
Once those changes have been made and have settled, it will be time to ask whether the quality of financial advice has improved, and whether financial advisers are behaving like professionals. It will also be necessary to ask whether remaining carve outs, exceptions and safe harbour provisions continue to be justified.