In June, ASFA launched Integrity Principles for Trustees and Debt Agreement Administrators, offering the personal insolvency profession a shared vision of good culture.
This is important, as the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry clearly demonstrated the strong correlation between culture and outcomes. Failings of organisational culture can foster poor decision-making or poor behaviour, leading to misconduct.
At AFSA, we are interested in continuing our understanding what defines culture, especially where it can influence behaviours that can impact the integrity of the personal insolvency system. We want to support good culture – and we know the profession wants to support this too. We will hold ourselves accountable to supporting a good culture at AFSA as well, with the Official Trustee subscribing to the Principles too. In the current environment of uncertainty and economic disruption, culture has never been more important.
The Principles were developed in consultation with the Australian Restructuring Insolvency and Turnaround Association, the Personal Insolvency Professionals Association, the Association of Independent Insolvency Practitioners, Financial Counselling Australia and ASIC.
They are intended to set a benchmark for industry best practice, offering a broad reference tool for practitioners making challenging decisions.
The Principles are designed to assist Trustees and Debt Agreement Administrators who often have to strike a difficult balance between competing interests and pressures. People who are struggling financially may be going through emotional turmoil. They may also be suffering from mental health or domestic violence issues. At the same time, their creditors also deserve fair treatment and insolvency practitioners themselves should be remunerated appropriately for their work.
Positive culture can support fairness when dealing with these competing interests and pressures, especially where vulnerable people are involved. It can also help to improve public trust and confidence in the work of the profession.
We expect the Principles to evolve over time with the industry. They are intended to be a living document, regularly debated and updated by the profession that owns them.
AFSA thanks the industry participants who contributed to developing the first iteration of the Integrity Principles.
National Manager – Regulation and Enforcement