AFA releases six principles of professionalism

The Association of Financial Advisers (AFA) has today released its new Six Principles of Professionalism, which forms a critical part of the AFA’s revised Code of Conduct (the Code), which will be released in full in the coming months.

AFA CEO, Brad Fox said in preparing these principles, the AFA sought the input of the AFA Code of Conduct Advisory Group, a group of experienced financial advice executives and advisers from a broad cross section of the industry. “This process has built upon the draft Principles of Practice document that was issued for consultation in 2012,” Mr Fox said. “We are thankful to the advisory group for their outstanding contribution and rigorous debate which greatly assisted in the development of these six principles.”

Mr Fox said whilst some industry, regulatory and parliamentary issues have held up the finalisation of the complete Code, the advisory group has now finalised the AFA Six Principles of Professionalism which has been approved by the AFA Board and made public today.

The ongoing legislative and regulatory debate has meant that the AFA has held back on releasing the final document pending the outcome of those processes, Mr Fox said. “We are continuing to refine the Code of Conduct in the light of ongoing changes in the legislation and regulation which affect matters such as the Opt-in exemption. With the removal of the Opt-in obligation a matter of ongoing public policy debate, this has held up the finalisation of the Code.”

In the meantime, Mr Fox said a number of other key developments have had implications for the specific requirements of a financial advice professional association code of conduct. “The Tax (Financial) Advice Association accreditation requirements under TASA and a range of relevant recommendations or terms of reference issues with current parliamentary Inquiries all had implications.”

The Code of Conduct Advisory Group has been working on all the key elements of the Code, including key principles, new member requirements, education and knowledge, and supervision and monitoring.

As the industry and regulatory issues are resolved, the AFA will move forward to release the full AFA Principles of Practice – Code of Conduct.

“We look forward to the finalisation of the Code of Conduct to ensure that our members are clear on the behaviours that their professional body and their peers see as essential conduct for professional financial advisers. Our members have been responsible for and held to a Code for decades but the continued progression of financial advice toward being a recognised profession means the Code’s relevance and value as a symbol of safety to consumers has increased.”

Mr Fox said, “Early indications are that our members see the Principles of Practice as appropriate and practical in terms of language and application.”

The AFA’s Six Principles of Professionalism.