Kenneth Hayne, who led the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, believes the broad findings in his report need to be applied by Australian business across the board, not just by the financial services sector. Making one of his rare public appearances since the release of the royal commission report in February 2019, Hayne told delegates at the International Congress of Actuaries in Sydney yesterday that several principles with general application were at the core of his recommendations. These include the connection between reward and conduct; the asymmetry of power and information between the providers of products and services and their customers; the conflict between the profits of the company and the interests of the consumer; and the limitations of the regulatory system in holding entities to account. Hayne’s view is that misconduct is usually driven by the pursuit of gain, and whereas sales volumes, income and profit can be monitored, compliance cannot be measured in the same way. He said that when the royal commission was starting its work it asked companies to tell it what they had seen in their businesses in the previous 10 years that fell short of community expectations. “Some of them told us their systems did not allow them to put together the information we were asking for,” he said. On the issue of asymmetry, Hayne said it is a question for all companies whether the customer’s inability to make informed choices increases the risk that the company will provide an inappropriate product. Those risks can be amplified where the customer relies on advice to make the decision and the product or service provider is also providing the advice. “We often see advisers rationalising what is in their interests as in the interests of their clients.” Hayne said all commercial enterprises need to consider these questions because they all face those risks. He said companies must have standards and principles. Standards are usually framed in legislation but they can get lost in the legal framework.  The norms that should be part of these principles include: obey the law; do not deceive; provide products and services that are fit for purpose; deliver products and services with care and skill; and when acting for others act in their best interests.