Financial technology innovation makes good corporate culture even more important in gaining customer confidence, according to Australian Securities and Investments Commission (ASIC) Chairman Greg Medcraft.

He says a recent Telstra report shows two-thirds of Millennials prefer to receive financial product and service advice via digital platforms, while automated advice is perceived as more independent and is preferred.

“We are at an exciting time in history, when technological innovation is rewriting almost every industry, including the financial services industry,” Mr Medcraft said in a speech to a regulatory summit. “Social licence, social media and the 24-hour news cycle are also changing customer expectations and the way customers behave.”

He says in this environment, building and maintaining a culture in which customers can believe is vital.

“There are more choices and information available to customers now than there have ever been. Firms that do not have a good culture risk losing their customers to firms that do.”

Mr Medcraft urges board members to monitor culture, even though they are not involved in a company’s daily operations.

“Board members might be ‘hands-off’, but I do think they should have their ‘noses in’.”

He says senior management should ensure compliance and governance frameworks are monitored and enforced, and staff should be encouraged to speak up when they see something is not right.