“Compliance obligations are broader than strict legal requirements and incorporate standards of integrity and ethical behaviour. ”
— Laker, Broadbent & Samuel “Final Report of the Prudential Inquiry into the Commonwealth Bank of Australia, APRA 1 May 2018, p7
Not a case of bad apples
At Assured Support, we believe that environmental, situational and contextual factors are more important contributors to misconduct than personal preferences, traits and abilities.
This is why we have never accepted the ‘bad apples’ explanation for systemic misconduct.
Over time, and thanks in no small part to the Royal Commission, the Regulators have also started to warm to this view. They now seem to downplay dispositional factors in favour of situational ones to which, for marketing purposes, they apply the amorphous and inchoate label of ‘culture’.
It’s challenging to define culture, but two recent cases highlight the importance of both assessing and defining your culture.
In both Australian Securities and Investment Commission v Westpac Securities Administration Limited  FCAFC 187 at 12 and Australian Securities and Investments Commission v Dover Financial Advisers Pty Ltd  FCA 1932, ‘culture’ was a critical consideration.
We’d also suggest that both cases show the limitations of internal compliance, and the importance of a Licensee Review conducted by an external party.
If you don’t think ‘culture’ is a pressing regulatory issue, take the time to consider ASIC’s recent decision to commence civil action against RI Advice.
Australian Securities and Investments Commission v Dover Financial Advisers Pty Ltd  FCA 1932
Compare and contrast
“Now more than ever, firms need to be thinking carefully about culture as a driver of risk and performance”
— Elizabeth Arzadon
We want to help you understand whether, and to what extent, you compare with your peers on ‘culture’.
The following diagnostic, extracted from our broader methodology, may assist you to understand some of the ‘measures, processes and procedures’ that we think are credible indicators of a business’ culture.
Clearly, an effective assessment requires far more analysis and introspection than the diagnostic allows, but it might help you focus your resources and prioritise your activities.
If it’s helpful, please use it. If it’s not helpful to you, don’t.
If you’d prefer a more detailed assessment, talk to us about a Licensee Review.
The survey is anonymous, but if you complete it you’ll be provided with the aggregated results against which you can compare your own business.
Basic Cultural Diagnostics
Your insights are crucial in shaping a comprehensive understanding of the compliance culture across the financial advice industry. Please select the option that best reflects your business’s practices.
Although your responses will contribute to a broader understanding of participants’ compliance cultures, responses will be kept anonymous and confidential.
Before you start the survey, please tell us a little about yourself.