FMA sets its sights on a fairer financial system through its 2022/23 work programme

MR No. 2022 – 29
25 August 2022

The Financial Markets Authority (FMA) - Te Mana Tātai Hokohoko today released its Annual Corporate Plan 2022/23 (ACP), signalling a period of change for both the financial services industry and the regulator itself.

The ACP sets out the FMA’s key priorities and intended work programme for the current financial year. This will involve the FMA delivering on three key areas:

• Maintaining a steady and consistent focus on building conduct maturity in the sectors the FMA already licenses and oversees;
• Delivery of core functions related to licensing, monitoring, and responding to egregious misconduct - particularly in relation to consumer harm; and
• Building capability to implement new legislation and taking on increased responsibilities under its expanding mandate as a conduct regulator.

There are three new legislative regimes coming into effect between 2023 and 2025:

• Financial advice regime (FSLAA) – full licensing in effect from March 2023
• Climate-related Disclosures (CRD) – developing standards and consultation through 2023, and the first climate-related statements due in 2024
• Conduct of Financial Institutions (CoFI) – conduct licensing opening in 2023, with fair conduct programmes and obligations in effect from 2025.

FMA Chief Executive Samantha Barrass said: “We have built a solid track record for implementing new legislative requirements for financial services in Aotearoa - conduct regulation is no longer a novel or foreign concept for firms. With the introduction of FMA licensing for banks, insurers and non-bank deposit takers, conduct obligations will be firmly at the heart of a fair financial system.

“As our remit grows, the FMA will have a greater focus on fair outcomes for consumers and investors. The financial sector is an enabler in people’s lives and it’s important it works well for all. In turn, this will shape how the FMA operates and organises itself as we step up and deepen our understanding of consumers and how they interact with financial markets and services.”

The ACP details the FMA’s key regulatory priorities across multiple sectors for the next 12 months. These include:

• a thematic review of the wholesale investor classification
• a cross-sector thematic review of governance within regulated entities – jointly with the Reserve Bank of New Zealand
• Managed Investment Scheme (MIS) and Discretionary Investment Management Service (DIMS) sector risk assessments
• Supervisor relicensing
• Cyber security and operational resilience

“To ensure that we deliver value for New Zealanders, the FMA needs to evolve how we undertake our work as we grow into a significantly larger organisation, and adapt our regulatory approach. We will need to elevate our capabilities – introducing new skills in data science, behavioural insights, and economics. This is an opportunity to refresh how we define and deliver our approach based on the outcomes we want to achieve, and to measure our effectiveness and efficiency in fostering a strong and trusted financial sector that treats people fairly,” Ms Barrass said.

“I’m looking forward to bringing our priorities to life over the next year, in particular providing support and guidance on the fair conduct programmes for CoFI, introducing a new conduct framework, and throughout all of this remaining an open, accessible and engaged regulator working with industry to implement these changes.”

ENDS

Download Annual Corporate Plan 2022/23

Media contacts:

Andrew Park
FMA Media Relations Manager
[email protected]
021 220 6770

Campbell Gibson
FMA Senior Adviser, Media Relations
[email protected]
021 945 323