Goodreturns has a piece by-lined BusinessDesk which is pessimistic about the outcomes for introducing the Conduct of Financial Institutions reforms. I found the attitude of the article intensely disappointing. Not because there aren't problems, when there plainly are problems. Not for the numbers that were right, or the numbers that were wrong - some are hard facts and some are conjecture, and we are all entitled to share a point of view. Not for the failure to be even handed, although it wasn't: the author is particularly critical of advisers, but the Hayne commission tended to find the biggest problems in direct and vertically integrated channels.
The main reason I am particularly disappointed is that it fails the standard the industry is being held to: it fails to address what a good customer outcome really is, and consider what the right pathway is to that. Instead it focuses on a few proxy numbers. Minister Faafoi does better because they have a vision of increasing confidence and clarity for consumers. MBIE does better because they consider efficiency as a whole and suitability throughout the product life-cycle as important factors. The industry does better because, contrary to the assertion in the article, they do look at more numbers than just new business. Lots of advisers, managers, owners, and leaders care a great deal about customer outcomes. Only one was quoted, but I could quote hundreds more. There are many differing views among them, interesting views that are actually shaping the future.
There are progressive parts of the sector that embrace change, and there are others that prefer a risk avoidance strategy. A customer-focused view of industry problems needs to consider the fundamental challenges of writing complex business with a multi-decade time-frame. Those include: complexity, information asymmetry, data availability, equity between customers, and customer engagement.
Contrary to the viewpoint in the article I think COFI has had a substantial effect already. An enormous amount of work by industry groups has been done to try and understand, guide, and change what goes on inside businesses, channels, and the conversations with customers however they engage, to address the real difficulties listed above - much of it has been work in progress and pre-dates COFI and the conduct review, such as the FSC Code of practice. I track every product change, every pricing change, at least a dozen products that had been unchanged for years have been updated and pricing revised. At least one product line has essentially been abandoned by the industry as a whole. That might be good - but being un-replaced there is a lot of unmet insurance need. Other changes are not solely conduct driven, but are related, like the acquisitions of bank insurers by specialists and the opening of new channels. There has been more change in the industry in 2019 than anyone thought possible in, say, 2017. 2020 looks like being even busier. Contrary to the pessimism displayed by the BusinessDesk piece few pieces of law or regulatory change can claim such success.