Login
iscover
The watchdog’s new priorities aim to keep pace with rapid technological changes, demographic shifts, and increasing climate-related risks.
Newsletter
ASIC sharpens focus on greenwashing, super misconduct, AI
23 August 2024
•
12 minute read
You’re out of free articles for this month
To continue reading the rest of this article, please log in.
Create free account to get unlimited news articles and more!
ASIC has unveiled its plans for 2024–25 that include tackling greenwashing, improving superannuation outcomes, and cracking down on businesses abusing technology like artificial intelligence.
Chair Joe Longo said the new priorities reflected changes in the country’s financial system.
“Rapid technological innovation is transforming service delivery, which presents both regulatory challenges and opportunities for innovation. Higher cost of living is putting pressure on businesses and consumers,” he said.
“These factors, along with an ageing population and government and business responses to climate change, have shaped our strategic priorities for 2024–25.”
According to ASIC’s corporate plan, the regulator would zero in on five key focus areas: improving consumer outcomes, addressing financial system climate change risks, advancing digital resilience, enhancing retirement outcomes, and driving market transparency.
ASIC said addressing climate change risks and ensuring integrity and fairness in energy and carbon credit markets were a priority with 80 per cent of ASX 200 companies having climate-related targets.
==
==
As a result, it said companies could expect its surveillance of climate-related disclosures to intensify, pledging ongoing enforcement action against misleading environmental claims.
On the superannuation front, ASIC said it would focus on member experiences, complaints handling, and claims processing.
“We will take action to target misconduct in the superannuation sector, with a particular focus on member experience, including superannuation trustees’ provision of services to members, and harms arising from complaints handling and claims handling,” it said.
The regulator would also be taking action against cold calling superannuation switching models that inappropriately eroded retirement savings.
The focus area was flagged by ASIC commissioner Simone Constant in a recent speech to super funds who were told to be more transparent and accountable to members.
According to the government’s latest Intergenerational Report, the coming decades would see the number of people over the age of 65 double and the population over 85 triple.
The report also showed the aged care economy could almost double to around 15 per cent of GDP by 2062–63.
“It’s clear Australians want better information to help guide them through the financial milestones of life,” Constant said.
“Transparency, accountability, consistency: where laws fall short of these expectations, ASIC will and must bring the full force and effect of the law.”
ASIC’s Corporate Plan also raised issues such as the design and distribution of financial products, predatory lending, and technology-enabled scams.
With Australians losing $2.7 billion to scams in 2023, it pledged to ramp up efforts to disrupt online investment fraud, building on last year’s takedown of over 7,330 scam websites.
“Our program will include supporting regulated entities in enhancing cyber resilience, including their use of third-party providers, by reviewing cyber resilience in various industries and sending letters based on findings,” it said.
Businesses’ use of AI would also be under the microscope, it said. “We will continue to monitor how retail financial services and credit entities use AI and advanced data analytics. We will also assess their risk management and governance processes.”
Longo said the regulator’s new structure meant it was better placed to respond to emerging market risks.
“In the last year alone we commenced around 170 new investigations – an increase of about 25 per cent, and we filed 33 new civil proceedings in the Federal Court – an increase of 27 per cent in civil proceedings on the previous year,” he said.
“Our investigations have led to 18 criminal convictions and seen a further 23 individuals charged by the Commonwealth Director of Public Prosecution for criminal offences.
“Our latest corporate plan and strategic priorities represent the next step of ASIC’s transformation journey to being a modern, confident and ambitious regulator.”
You are not authorised to post comments.
Comments will undergo moderation before they get published.