It’s been 15 years in the making, but the vision which inspired FMD founders Greg Fagan, David Murray and Adam Davenport to build a relationship-driven, fee-for-service advisory firm is now poised to become the national service standard for investment and superannuation advice.
In its response to recommendations made in the 2013 Financial Systems Inquiry, the Federal Government recently confirmed it will introduce new legislation in mid-2016 aimed at lifting the professional, academic and ethical standards of financial advisers. This comes as part of a broader financial industry overhaul designed to better position Australia for economic growth through greater innovation, increased fairness and stronger accountability.
FMD Financial is one of a select number of firms to be accredited as an FPA Professional Practice which demonstrates adherence to the highest professional, ethical and academic standards. “FMD is ahead in the race for higher standards because we’ve always demanded the best from ourselves and our people,” says Greg.
New standards for financial advisors
The new legislation will require all advisors:
What do the industry changes mean for consumers?
1. Better protection
The Government will assign greater consumer protection powers to ASIC, enabling the corporate watchdog to intervene or ban harmful financial products.
2. More efficient superannuation policy
Pending an evaluation by the Productivity Commission, consumers will enjoy greater investment flexibility and access to a more comprehensive range of income options.
A recommendation to stop people borrowing via superannuation funds to purchase assets has been rejected for now, but the Government has opted to take a wait and see approach, with a further report in three years.
3. Greater financial resilience
Higher bank capital requirements will provide greater protection for the Australian market against future shocks.
Better reporting, administration and cyber security measures will also be implemented.
4. Digital innovation
A raft of changes aimed at streamlining charges and payments will see further progress towards technology neutrality - giving consumers greater freedom and the means to make informed choices.
FMD co-founder Adam Davenport see the next evolution of financial advice as even more tailored and personal. “Life is fast-paced and complex. Australian professionals now change jobs every 3-4 years and homes every 10 years. They are getting married and starting families later, getting divorced earlier and creating more blended families,” says Adam.
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General advice disclaimer: This article has been prepared by FMD Financial and is intended to be a general overview of the subject matter. The information in this article is not intended to be comprehensive and should not be relied upon as such. In preparing this article we have not taken into account the individual objectives or circumstances of any person. Legal, financial and other professional advice should be sought prior to applying the information contained on this article to particular circumstances. FMD Financial, its officers and employees will not be liable for any loss or damage sustained by any person acting in reliance on the information contained on this article. FMD Group Pty Ltd ABN 99 103 115 591 trading as FMD Financial is a Corporate Authorised Representative of FMD Advisory Services Pty Ltd AFSL 232977. The FMD advisers are Authorised Representatives of FMD Advisory Services Pty Ltd AFSL 232977.