The Australian Securities and Investments Commission (ASIC) has released a guide setting out its approach to the approval and oversight of compliance schemes for financial advisers.

Advisers must comply with a code of ethics and have their compliance monitored and enforced by ASIC-approved compliance scheme from January 2020 as part of government reforms to lift industry standards.

“Our guidance requires high standards for compliance schemes, reflecting the significant responsibility that monitoring bodies operating compliance schemes will have,” outgoing Deputy Chairman Peter Kell said.

“This includes the responsibility to effectively monitor and sanction adviser members if required.”

Behavioural change, transparency, and consistency and fairness as the three principles guiding ASIC’s approach.

The regulator will consider a number of key factors when assessing applications for compliance scheme approval.

These include the competence of monitoring body’s existing staff, processes and resources the body intends to use and number of advisers covered by the scheme.

For more details on the guide, click here.