The Financial Planning Association (FPA) has released new principles for managing conflicts of interest to mark what it calls the “beginning of a new relationship” between financial planners and clients.

The four principles will come into effect from July 1 and are designed to provide guidance to members on policy and practice.

FPA Chairman Corinna Dieters says the principles were put in place to guide members in working to the best interest of clients and are broadly driving the standards of the organisation.

“The principles are part of a wider body of work by the FPA to improve remuneration practices in financial planning, including the alternative remuneration code implemented in 2004.

“The FPA’s adoption of the principles will strengthen this process and benefit clients who deal with FPA members,” she said.

The new principles will set out a “financial advice fee” to be negotiated between the client and adviser, which can be discontinued by either party when acceptable.

Ms Dieters told Sunrise Exchange News ASIC has been involved with the taskforce drafting the principles and is supportive of the FPA’s implementation plan.

Under the principles, complaints or non-compliance concerns will result in individuals facing a disciplinary system. Ms Dieters says members will face fines of up to $20,000 or a possible banning from the FPA.

She says she while some members may not agree with the new system, there has been no talk of any leaving.