A bill that would pave the way for a new financial conduct regime in New Zealand has been introduced into Parliament.

The Financial Markets (Conduct of Institutions) Amendment Bill aims to ensure that financial services providers such as life insurers and their intermediaries comply with a principle of fair conduct.

Incentives for staff and intermediaries who meet sales targets will also be regulated under the new regime.

Financial Advice New Zealand CEO Katrina Shanks has welcomed the bill, saying it will “improve the services and products” provided to consumers.

“I’m confident the new regulatory regime that will flow from this legislation will provide additional focus for institutions on the principles of fair conduct and how to apply them, by introducing systems to identify, manage, and remedy conduct issues,” Ms Shanks said.

“The move to bring institutions under a fair conduct regime that ensures consumers are treated fairly, starting from the early design of products and services right through to the claims process, is very timely because the end user must always be at the centre of product design and suitability.”

While calling the move to regulate sales incentives for some products a “good idea” in principle, Ms Shanks says this should not compromise consumers’ access to financial advice.

She says there must be “processes and controls” in place for consumers to seek advice.