FINSIA – The regulators: Priorities updated


Opening remarks by James Shipton, Chair, Australian Securities and Investments Commission, to the Financial Services Institute of Australasia (FINSIA) webinar ‘The Regulators: Priorities Updated’, 21 May 2020.


Thanks Chris.

Thanks to you and FINSIA for this important initiative.

ASIC is a keen supporter of FINSIA’s efforts to promote greater professionalism in the financial services industry.

Let me start by agreeing with the observations of my colleagues Philip and Wayne, especially regarding the importance of the Council of Financial Regulators as a key forum for regulatory coordination.

Having spent much of my professional career abroad, I am convinced that Australia is incredibly well served by its regulatory institutions and lucky to have leadership from people such as Philip and Wayne.

In times like these, institutional credibility of our economic and financial public institutions is absolutely paramount.

ASIC is playing its part in responding to the current crisis, and this requires that we make some changes to our approach.

That said, our important role and mandate will always endure and apply in whatever the circumstances.

Achieving our vision of a fair, strong and efficient financial system for all Australians depends on it.

In the coming weeks, we will announce a revised set of strategic priorities for the next few months.

However, today, I can outline our adjusted approach as well as some of the work we have been doing in response to the crisis.

There are 5 key areas that I would like to briefly touch on now. They are:

  1. ASIC’s regulatory work and priorities for the time being
  2. our work to ensure Australia’s capital markets continue to serve the real economy by operating in a fair, orderly and efficient manner
  3. our continued enforcement work where there is significant risk of consumer harm
  4. the enhancement of information for consumers on our MoneySmart website and increased targeted consumer messaging
  5. through all of this, making clear to regulated entities our expectations on how to deal with their customers.

ASIC’s regulatory work and priorities for the time being

Firstly, ASIC has recognised the extraordinary demands placed on businesses and the broader community by COVID-19.

Accordingly, ASIC has changed its regulatory priorities for the time being.

This has meant the deferral of some activities and redeployment of staff so that we can address issues of immediate concern.

Critically, this enables us to focus on key challenges such as maintaining the integrity of markets and protecting vulnerable consumers.

Examples of this approach include:

  • deferral of less time-critical reviews, supervisory initiatives and investigations
  • no-action relief for entities holding shareholder meetings, that is now extended until late-2020
  • sixth months delay of:
    • the final implementation of the ‘best-interests’ duty for mortgage brokers
    • the design and distribution obligations for financial products issuers.

It is important to note that this is not an abrogation of our regulatory work. Instead, it is a recognition that some existing activities, and new tasks, must take precedence over the work we would otherwise be doing in order to respond to the pandemic.

Ensuring Australia’s equity and capital markets continue to operate in a fair, orderly and efficient manner

Secondly, ASIC has acted to ensure that Australia’s equity & capital markets have continued to operate in a fair, orderly and efficient manner.

We have done this by quickly imposing a daily limit on the total number of ASX and CHI-X equity trades, following a huge volume spike, back in March.

This action prevented delays in settlement that would have undermined investor confidence in the market and the wider economy at a critical and fragile time.

We have now relaxed this requirement but continue to specifically monitor trading volumes, as well as the market more broadly.

We also authorised the ASX’s relaxation of rules that limited share placements by listed companies.

By doing so, we enhanced the ability of companies to bolster their balance sheets in a liquidity constrained environment.

We did this keeping in mind market fairness issues, so that boards are also required to explain to shareholders why the type of offer was necessary and how mum and dad shareholders could also participate.

As a result of these actions, and the robustness of Australia’s capital markets, listed companies have raised in excess of $21 billion in 80 transactions since the COVID-19 crisis began.

This is vital to support the real economy in a time of severe economic strain.

It also shows that Australia is a world leader in terms of our capital markets stepping up to support Australian companies and the Australian economy when it is most needed.

Our continued enforcement work where there is significant risk of consumer harm

Thirdly, we continue to investigate, enforce and prosecute breaches of the law where there is significant risk of consumer harm.

This is particularly important at a time when the community is being asked to bear a very heavy burden in meeting the economic and social costs of the recovery.

Past illegal conduct, including behaviour identified by the Hayne Royal Commission, must continue to be a priority.

Moreover, swift action must be taken where firms or individuals attempt to take advantage of consumers at a time of heightened vulnerability and financial strain.

To this point, ASIC has actively sought to warn consumers where they are at risk of financial harm, including with:

  • warnings about unlicensed and inappropriate financial advice
  • warnings about scams and fraud.

Enhancement of information on our MoneySmart website and increased targeted consumer messaging

Fourth, we have also sought to help Australians find appropriate advice when making important financial decisions at this time of significant economic stress.

We have done this by enhancing information on our MoneySmart website and through targeted consumer messaging.

This has included:

  • advice on our MoneySmart website about what to take into account if Australians are considering drawing on their superannuation and how best to go about doing so
  • guidance on MoneySmart for consumers to make good decisions about loan repayments, including if they are considering a repayment deferral
  • ‘health warnings’ to retail shareholders on how to avoid being taken advantage of and what to be aware of when trading in such volatile market conditions
    • This involved a rapid review and analysis of retail investor trading and performance in equities and contracts for differences during the early stages of the pandemic
  • warnings to consumers about misleading advertising of financial products that are made to seem safer than they really are.

Making clear to regulated entities our expectations on how they should behave

Finally, through all this ASIC will continue to make clear to regulated entities our expectations on how they should behave.

Despite the challenges posed by COVID-19, ASIC expects entities to treat customers fairly, avoid adding further financial harm or burden to consumers, and act to maintain the integrity and efficiency of markets.

In other words, we expect the industry to adopt a stance of utmost professionalism in everything that they do right now.

For our part, we have written to lenders and insurers setting out our expectations. We did the same, together with APRA, for superannuation trustees. And, we also published FAQs for financial advisers.

Regardless of the prevailing circumstances, the financial services sector continues to have community-oriented obligations under the law including, where applicable, to:

  • act fairly, honestly and efficiently;
  • report material breaches of the law;
  • maintain proper records of the financial services they provide; and
  • ensure appropriate supervision of financial & credit services and activities, even where staff are working remotely.


In closing, there has never been a greater need for the financial services industry to live up to the professional expectations of the community.

More than ever before, we – and the community – expect financial services professionals to perform their crucial roles competently and conscientiously.

That is, with the utmost professionalism.

Once again, I’m grateful to FINSIA for creating this forum and its ongoing work to promote professionalism in financial services.

I look forward to the panel discussion and answering your questions.

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