Australian financial advice industry

The **Australian financial advice industry** comprises businesses and professionals that provide financial product advice, including advice about investments, superannuation and insurance. Its scope includes personal and general advice, delivered to retail or wholesale clients. The sector operates mainly under the *Corporations Act 2001* and is overseen by the Australian Securities and Investments Commission (ASIC), with licensing, conduct, disclosure and professional standards depending on the service provided.^[1][2]

Scope and types of advice

ASIC describes the financial advice sector broadly: it includes Australian financial services (AFS) licensees authorised to provide financial product advice to retail or wholesale clients. This encompasses personal advice to retail clients about relevant financial products, advice on other products, general advice, and personal advice provided only to wholesale clients.^[1] The industry is therefore wider than the group of individual advisers shown on the public Financial Advisers Register.

Under ASIC’s description, advice is **personal advice** if the provider has considered one or more of a client’s objectives, financial situation and needs—or if a reasonable person might expect that consideration to have occurred. Other financial product advice is classified as **general advice**. General advice does not take account of a particular client’s circumstances in this way; ASIC says a warning must be given when general advice is provided to retail clients.^[2]

The distinction matters because obligations differ according to whether advice is personal or general, and whether the client is retail or wholesale. Factual information is another category: ASIC describes it as objectively ascertainable information whose truth or accuracy cannot reasonably be questioned. Providing factual information alone does not require an AFS licence, according to ASIC.^[2]

Advice may address matters such as investment choices, retirement planning, insurance, or the use of superannuation savings. Advisers may provide broad financial plans or focus on a particular issue; ASIC’s guidance on the best interests duty expressly discusses both comprehensive and scaled personal advice.^[3] The scope of any engagement depends on the provider’s authorisations and the service offered. Advice about products excluded from ASIC’s definition of relevant financial products—such as basic banking products and general insurance—does not, by itself, place an individual on the Financial Advisers Register.^[4]

Providers and business models

Advice is delivered through businesses operating under an AFS licence or through representatives authorised by a licensee. ASIC states that a person providing financial product advice must be authorised by an AFS licensee with the necessary authorisations for that advice business.^[2] A licensee may be an organisation or, in some cases, an individual. Advisers can work as employees, authorised representatives, or licensees in their own right; the applicable regulatory status and responsibilities depend on the arrangement.^[4]

The business landscape includes specialist advice practices and advice operations connected to other financial services businesses. ASIC identifies advice relating to insurance, superannuation, self-managed superannuation funds and digital advice as areas represented in its engagement with practising advisers.^[5] These examples illustrate the range of services and delivery channels, rather than a complete classification of the industry.

Consumers can use ASIC’s Financial Advisers Register to check an adviser’s authorisation and registration status and review information such as qualifications, experience and employment history. The register is managed by ASIC and published on the Moneysmart website. It lists individuals authorised to provide personal advice to retail clients about relevant financial products; it does not list every person or firm that provides any form of financial information or advice.^[4]

Regulation and consumer protections

The *Corporations Act 2001* establishes the central framework for financial services, including licensing and rules for providing financial product advice.^[6] ASIC administers and enforces relevant requirements. Among other things, ASIC monitors licensees and advisers, conducts supervision and surveillance, provides guidance, and may use enforcement tools including licence cancellation, banning orders and civil or criminal action.^[1]

For retail clients, disclosure requirements depend on the service. ASIC says entities providing financial product advice to retail clients must provide a Financial Services Guide or make specified disclosure information available on a website. Retail clients receiving personal advice must generally receive a Statement of Advice, while retail clients receiving general advice must receive a general advice warning.^[2] These materials are intended to explain the provider’s services and the nature of the advice, though the precise obligations depend on the circumstances and applicable law.

A central consumer-protection rule for personal advice to retail clients is the **best interests duty** and related obligations. ASIC describes these as intended to ensure advice meets the client’s objectives, financial situation and needs, and that the adviser prioritises the client’s interests.^[3] Its regulatory guidance addresses how the duty applies to both comprehensive and scaled advice, along with related conflict-management requirements.^[3]

Rules also restrict conflicted and other banned remuneration in specified circumstances. ASIC’s Regulatory Guide 246 explains that the relevant provisions apply to financial product advice given to retail clients and to certain benefits connected with life-risk insurance products.^[7] The rules are part of the framework for managing incentives that could affect advice, but their application depends on the payment, product and legal circumstances involved.

Licensees have responsibilities in addition to those applying to individual advisers. ASIC’s sector overview says it monitors licensees’ and advisers’ conduct obligations under the *Corporations Act* and may take action where misconduct or consumer harm is identified.^[1] The licensing framework makes the authorising business relevant to supervision and compliance, not merely the individual giving advice.^[2]

Adviser registration and professional standards

An individual generally must be registered with ASIC before providing personal advice to retail clients about relevant financial products. ASIC states that AFS licensees apply to register relevant providers, and the public register displays registration status.^[8] Licensees are responsible for submitting and updating adviser information; ASIC says failure to meet the update obligation may breach their requirements.^[4]

Professional standards apply to relevant providers who provide personal advice to retail clients on relevant financial products, as well as to people training to become relevant providers. ASIC’s outline identifies requirements concerning approved qualifications, the financial adviser exam, a professional year for trainees, continuing professional development (CPD), and compliance with the Financial Planners and Advisers Code of Ethics 2019.^[9] The specific pathway and timing can depend on an individual’s circumstances and status.^[9]

ASIC’s qualifications guidance says relevant providers and provisional relevant providers must meet the applicable qualifications standard. It describes approved degrees or equivalent pathways and, for certain existing providers, an experienced-provider pathway subject to specified criteria.^[10] These requirements form part of a professional framework for the subset of advisers covered by the relevant-provider rules; they should not be read as applying identically to every person who provides financial information or advice.^[9][10]

Reform and industry issues

A recurring policy issue is how to make advice accessible and affordable while maintaining quality and consumer protections. The Quality of Advice Review’s final report, provided to the government in December 2022 and released in February 2023, contained 22 recommendations concerning the regulatory framework.^[11] The government subsequently set out its response through the Delivering Better Financial Outcomes reforms.^[12]

The first tranche of those reforms became law as the *Treasury Laws Amendment (Delivering Better Financial Outcomes and Other Measures) Act 2024* on 9 July 2024. Treasury said the changes simplified rules it considered to add costs without corresponding consumer benefits; the broader reform objectives included expanding advice services, reducing unnecessary compliance and preserving consumer protections.^[13] Later announcements described further reform work, but the content and commencement of any particular measure should be checked against current legislation and official guidance rather than inferred from a policy announcement.^[13]

The regulatory setting continues to develop through legislation, ASIC guidance and supervision. For consumers and market participants, important practical distinctions include whether advice is personal or general, whether the client is retail or wholesale, whether a product falls within the relevant statutory category, and which licensee authorises the provider. These distinctions determine much of the applicable disclosure, conduct, registration and professional-standards framework.^[2][4][9]