KUALA LUMPUR: The Securities Commission (SC) has issued the revised Guidelines on Conduct for Capital Market Intermediaries (Guidelines), aimed at elevating standards of professionalism and integrity of capital market intermediaries (CMIs) in the industry.
The revised guidelines, among others, reinforce the role of a CMI’s board and senior management in inculcating a corporate culture where clients’ interests are prioritised.
The guidelines also clarify the SC’s expectations regarding CMIs’ duty to act honestly and fairly and avoid misleading and deceiving their clients under any circumstances.
SC, in a statement, said the new chapters are introduced to address crucial areas, such as the treatment of vulnerable clients, as well as providing personal advice and capital market-related services, including through online platforms.
SC chairman Datuk Seri Dr Awang Adek Hussin said the revised guidelines signify the SC’s efforts towards fostering trust, integrity and client-centricity in the capital market industry by, amongst others, minimising the risk of mis-selling, avoiding reputational damage, reducing complaints and improving client retention.
“Fairness is a cornerstone principle, requiring CMIs to consider the client’s circumstances, including any vulnerabilities that the client may have, communicate clearly and ensure comprehension of product details and associated risks,” he said.
“When providing personal advice to a client, a CMI must exercise care, skill and diligence and give due regard to the client’s interests.
“We are confident that these enhancements will elevate standards and reinforce investor confidence in our capital market,” he said.
In revising the guidelines, the SC has considered feedback from engagements with, among others, Bank Negara Malaysia, the Federation of Investment Managers Malaysia and relevant capital market intermediaries.
The revised guidelines will come into effect on October 1, 2024 to allow sufficient time for capital market intermediaries to familiarise and prepare to meet the new requirements of the revised guidelines.
