The financial services industry has supported the Government's move to tighten the regulation of credit rating agencies (CRAs) and research houses.
The Minister for Superannuation Nick Sherry announced last week that the Government would require all CRAs to hold an Australian Financial Services Licence (AFSL) and produce an annual compliance report.
The report is to include information on how agencies have complied with the revised International Organisation of Securities Commissions (IOSCO) code of conduct with respect to CRAs, as well as disclosing any conflicts of interest.
The Investment and Financial Services Association (IFSA), the Financial Planning Association (FPA) and the Association of Superannuation Funds of Australia (ASFA) have all backed the Government's move.
"It is a sensible move to include those research and credit houses that, as yet, do not have an AFSL licence. It is important that research houses and rating agencies have some code of conduct," IFSA chief Richard Gilbert said.
"Research houses and credit rating agencies play an important role in delivering information to financial planners, consumers and industry in general, so it is important that they are subject to the same regulatory requirements as other key players," FPA chief executive Jo-Anne Bloch said.
Bringing rating and credit agencies under one regulatory framework creates a level playing field, according to ASFA chief executive Pauline Vamos.
"Good quality research, about products and institutions across all parts of the sector, is a vital tool so that we can provide appropriate and best advice to all members," Vamos said.
