CONDUCT AND CULTURE REGULATION
Greater detail on the fair conduct programme
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he central requirement of the new regime is the obligation to establish and maintain a “fair conduct programme”. Every registered bank, licensed insurer and licensed non-bank deposit taker will be under a statutory duty to establish and maintain such a programme.
of the financial institutions to which they provide services or products. For an intermediary, fair conduct obligations will be a function of its negotiated contractual obligations to the financial institution.
Intermediaries are not required to have a fair conduct programme. The Select Committee has also recommended the removal of the duty on intermediaries to comply with the fair conduct programmes
A fair conduct programme is a set of documented policies, processes, systems and controls designed to ensure a financial institution’s compliance with the fair conduct principle, and the compliance of
What is a fair conduct programme?
| GREATER DETAIL ON THE FAIR CONDUCT PROGRAMME
any related intermediaries. The scope of any such programme will be broad. The Bill provides that the programme should address the entire lifecycle of relevant services or associated products including the design, offer and provision of the services and products, including any dealings with consumers. What will a fair programme need to address? As introduced, the Bill contained limited detail of the expected requirements of a
fair conduct programme. It was originally expected that regulations would impose the detailed requirements for fair conduct programmes. In response to concerns from the industry, the Committee observed that leaving details of the requirements to regulations “would not provide certainty”. It has recommended that the Bill contain the high level requirements for these programmes together with a regulation-making power to add additional requirements, but only to the extent that they are “necessary”.
