The Insurance Council of Australia has backed plans by the Australian Securities and Investments Commission (ASIC) to strengthen penalties for corporate and financial sector misconduct.

In a submission on an ASIC Enforcement Review Taskforce position paper, the Insurance Council acknowledges the period of time since the level of penalties was established and “inconsistencies in the magnitude” of penalties.

However, it reminds ASIC that “an effective penalties regime is but one component” of the regulatory enforcement toolkit.

“In our experience, a regulatory regime that is responsive and nimble in encouraging good outcomes is not only fostered by strict adherence to the regulatory rules, but is outcomes-focused and encourages innovation,” the submission says.

“In this regard, a robust penalties regime should complement the broader objective of facilitating good outcomes in the financial system, and not stifle a more innovative approach in areas such as consumer disclosure.”