Australian Competition and Consumer Commission Chairman Rod Sims says companies too often behave badly and regulators must act to reveal and avert actions that harm customers.

“The greater the likelihood that bad behaviour will be exposed and made public, the more companies will do to guard against such behaviours,” he said in a speech in Tasmania.

“A key value of the [Hayne] royal commission has been to expose the poor behaviour of financial institutions to public scrutiny.”

Incentives to maximise shareholder returns too often result in behaviour that causes customers to lose out, he says.

“It is often said that companies succeed by looking after the needs of their customers.

“However, I have been surprised over very many years at the way in which many businesses often do precisely the opposite.

“We have observed firms winning customers through misrepresenting their offers and employing high-pressure selling tactics. In addition to hurting consumers, this type of behaviour hurts rival firms.”

Mr Sims says bad behaviour is more likely to be “punished” in competitive markets and the ACCC has increased its focus on studies exploring ways to increase competition. Projects on its agenda include the examination of northern Australian insurance.

Companies can act out of step with community perceptions while believing they are behaving rationally, he says.

Examples include charging new customers less than those continuing to pay for a service.

“The common reaction from loyal customers is outrage when they discover they have, for years, been paying more than they needed to,” he said.