State the five fair dealing outcomes in your own words and say which of them depend on you.
Take a blank sheet of paper and, without checking any notes, write down the five fair dealing outcomes MAS sets out, in MAS's order if you can manage it. Leave a gap wherever you are unsure. The gaps show you which outcomes to read most carefully below, and each one matters because every case you write is assessed against all five.
Picture a firm's training day. A slide headed "fair dealing" holds five boxes crammed with text, a compliance officer reads each box aloud, and most of the audience are looking at their phones. Ask the same audience a year later and half of them could not tell you what the five boxes said. Their cases are still measured against those five outcomes every time.
The Monetary Authority of Singapore (MAS) issued the Guidelines on Fair Dealing to describe the outcomes it expects financial institutions to deliver for their customers. The full title states that the guidelines are for the board and senior management. They are addressed to firms, and responsibility for making the outcomes happen across the business rests with the people at the top.
This does not excuse representatives. Board members do not attend client meetings, so most of the outcomes reach a customer only through what representatives do. Firms use a few tools to see that you deliver the outcomes on their behalf: the sales process they set, the way their fact-find form is designed, and the sampling of your cases.
MAS writes the fair dealing outcomes in formal language. The versions here are informal, closer to how you would explain them to someone who joined your team last week. They follow MAS's order.
The first outcome concerns culture. Customers should be able to trust that fair dealing sits at the centre of how the firm operates and is not something added on. You can see it in the way the firm pays its people, in what managers praise, and in what happens when sales and fairness pull in different directions.
The second concerns suitable products. A firm should offer products and services that suit the customer segments those products are aimed at. A complex investment product built for experienced investors, for instance, should not be sold to a retiree who has never invested.
The third concerns competent representatives. Customers should be served by representatives who are competent. It is the outcome nearest to the reasonable basis requirement from lesson 1.1, "Financial advice is a regulated act, not a sales pitch".
The fourth concerns information. Customers should get information that is clear, relevant and timely, so their decisions are informed ones. Information is timely when it arrives early enough to inform the decision. Suppose a brochure is handed across at the close of a meeting, once the client has already agreed. Every sentence in it may be accurate and it still fails "timely".
The fifth concerns complaints. Firms should deal with complaints independently, effectively and promptly. A client who is unhappy should meet a process that treats the matter seriously and is run by someone other than the person the complaint is about.
Put yourself in your own seat at a client meeting and look at each outcome in turn.
Culture is something you can influence without setting it. If a sales contest is behind a product and you decline to push it, colleagues see that. Pay structures and management decisions are made by the firm. Complaints work in a similar way: the firm owns the process, and your job is to recognise a complaint, record it and pass it on. Lesson 2.4, "Complaints, conflicts and the habits that cause them", goes through that job.
Outcomes 2, 3 and 4, the middle three, depend on you the most. On suitability, the firm chooses which products to offer and to which segments, while you choose whether a given product goes to the person sitting opposite you, so suitability is delivered in your meetings. Being the competent representative who serves the customer rests with you completely. Information that is clear, relevant and timely is also yours to deliver, since you are the one explaining the product and deciding when the client gets the documents. Lessons 2.2 and 2.3 work through these three outcomes separately.
Wei Ling (an invented example) has a meeting coming up with Hafiz and Nadia, a couple whose first child has just been born. While preparing, she asks herself three questions, each tied to one of the middle outcomes:
Will I recommend only what fits them, not just what fits people like them? This covers suitability, outcome 2. Can I show how my advice follows from what they told me? This covers competent representatives, outcome 3. Will they see the documents early enough to read them? This covers timely information, outcome 4.
Her rule is that if she cannot answer yes to all three, she is not ready. Put the same three questions to yourself before your own client meetings and apply the same rule: any answer other than yes means you are not ready yet.
A summary such as this one helps you remember the outcomes, and it leaves detail out. The guidelines go further. For each outcome they set out what MAS expects and give examples of practices MAS regards as good or poor. Those examples are the closest you will get to MAS's own view of fair dealing in practice, and they seldom appear on training slides.
Look up the current version of the Guidelines on Fair Dealing on the MAS website and read the whole document once. Mark the places where MAS describes something you have come across in your own firm or in the industry, whether good or bad. If your firm has written its own fair dealing policy, read that next to the guidelines, since it shows how your firm has chosen to put the outcomes into practice.
In the activity below you write each outcome as a single sentence in your own words. Use the version you would give a friend who asked what fair dealing means, then mark the ones you deliver yourself when you sit down with a client.
Write each of the five outcomes as one sentence in your own words, then mark the ones you control yourself in a meeting.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).