Governance News 13 February 2019

60 minute read (PDF download)  12.02.2019 Mark Standen, Siobhan Doherty, Kate Hilder

This special edition of Governance News features as our top stories, insights from MinterEllison's experts on the industry impacts of the Financial Services Royal Commission Final Report Recommendations in addition to coverage of other key regulatory and governance developments in Australia and overseas.

Full coverage of this weeks content is now available. Past issues are available

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We provide weekly summaries of key regulatory and governance developments in Australia and overseas.

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https://www.minterellison.com/articles/governance-news-13-february-2019

Institutional shareholders and stewardship Navigation Show below Hide below

  • United Kingdom | Consultation on proposed changes to the UK Stewardship Code: Proposed changes include a new requirement for investors to report on how their purpose, values and culture enable them to meet their obligations to clients and beneficiaries and an explicit requirement to take ESG factors into account
  • State Street has identified culture as a top stewardship priority: 'Given growing investor interest in this area, directors and senior management should be prepared to discuss the management of human capital in the context of corporate culture as a driver of long-term value'
  • What investors want to see in disclosure on board evaluation processes: CII suggests there are seven indicators of 'strong disclosure'

Meetings and proxy advisers Navigation Show below Hide below

  • ASIC 2018 Annual AGM Report: ASIC found there was a 'strong display' of shareholder engagement particularly on ESG and remuneration issues

Regulators Navigation Show below Hide below

  • ACCC to take on 'super complaints' under Labor?  Labor has announced that, if elected, it plans to implement a 'super complaint' function with the ACCC based on the mechanism used by the UK CMA
  • Post-implementation review of the prudential framework for superannuation: The AIST's submission calls on APRA to establish a new data reporting framework 

Corporate social responsibility and sustainability Navigation Show below Hide below

  • IOSCO´s Growth and Emerging Market Committee is consulting on recommendations related to the development of sustainable finance in capital markets and the role of securities regulators in the area
  • Sustainability is increasingly accepted by European boards as a critical issue but businesses have a diversity of approaches to the issue according to a new study

Financial Services Navigation Show below Hide below

Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (Financial Services Royal Commission)

  • Top Story | MinterEllison insights into key FSRC Final Report Recommendations
  • FSRC Final Report: The government's initial response, Federal Labor's response
  • FSRC recommendations 3.6 and 3.7: The government plans to amend Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No 1) Bill 2017
  • 'Forward looking' APRA capability review to commence in March, three person panel named 
  • Progress towards a national farm debt mediation scheme: agreement to take the 'first steps' towards actioning the Commission's recommendation
  • 'Immediate' review of financial counselling services announced
  • APRA's timeline for implementing the Financial Services Royal Commission's recommendations

Other Financial Services Developments

  • New Zealand | The New Zealand Financial Markets Authority (FMA) and Reserve Bank of New Zealand (RBNZ) have jointly released their review into the conduct and culture of NZ life insurers 
  • Treasury Review into Initial Coin Offerings (ICOs): Issues paper released for consultation 
  • As a signatory to the Global Financial Innovation Network (GFIN), ASIC is inviting applications from firms to be part of a pilot to test innovative financial products, services or business models across more than one jurisdiction
  • Buy now pay later update | Licensing requirements for debt management firms? AFCA's submission to the Inquiry calls for a new framework to regulate debt management firms, including licensing requirements
  • Superannuation reform Bill update: Treasury Laws Amendment (2018 Measures No 4) Bill passed both houses on 12 February  
  • The Superannuation Complaints Tribunal Q4 2018 newsletter reports an uptick in the volume of complaints, the largest complaint category continues to be death benefits
  • Enforcing the terms of its Enforceable Undertaking: ASIC has required CFPL to immediately stop charging/receiving ongoing service fees and not to enter into any new ongoing service arrangements
  • In Brief | Banking System Reform (Separation of Banks) Bill 2019: Senator Pauline Hanson has introduced a private member's Bill which proposes, among other thing, to 'end vertical integration'
  • In Brief | APRA has announced it has licensed Lutheran Laypeople’s League of Australia as an authorised deposit-taking institution (ADI) under the Banking Act 1959 (Cth)
  • In Brief | FASEA Code of Ethics standard finalised: The Financial Adviser Standards and Ethics Authority (FASEA) has registered its Code of Ethics for financial planners and advisers.  The obligation to comply with the Code 'applies on and from' 1 January 2020

Risk management Navigation Show below Hide below

  • ASIC update on Brexit planning, firms with global operations encouraged to review their AFS licensing arrangements
  • Losing the fight against corruption?  Most countries are failing to control corruption, according to the latest corruption perceptions index from Transparency International
  • Monitoring and overseeing culture: Time for businesses to consider creating new executive positions such as chief ethics officer? 
  • Not for Profit Governance Principles (2nd edition) released

Full coverage of this weeks content is now available. Past issues are available

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https://www.minterellison.com/articles/governance-news-13-february-2019