What is a Responsible Manager?

A Responsible Manager is a key individual within a business. ASIC checks the Responsible Managers to ensure that the licensee is “competent” to provide the financial services authorised by their Australian Financial Services Licence (AFSL).

ASIC outlines what they look for when they assess compliance with the ‘organisational competence obligation’ in Regulatory Guide 105 Licensing: Organisational Competence (RG 105).  

Responsible Managers must:

  • be directly responsible for significant day-to-day decisions about the ongoing provision of financial services;
  • be of good fame and character; and
  • have the requisite knowledge and skill.

The number of Responsible Managers varies and depends on the nature, scale and complexity of the business.

If a licensee is heavily dependent on the competence of one or two Responsible Managers (e.g. in a small organisation with one or two principals), then ASIC will generally impose a “key person” condition on the licence.

What do Responsible Managers do?

ASIC expects Responsible Managers to play an active role in fostering the compliance culture in the business and in the industry.

Our Responsible Manager Fundamentals course is designed for newly appointed or aspiring responsible managers working in an organisation who holds an Australian Financial Services (AFS) licence.

It is also ideal for organisations wanting to ensure their existing responsible managers have an appropriate standard of knowledge and skills about AFS licensing and the important, ongoing role they play in ensuring organisational competence.

How are Responsible Managers nominated?

Responsible Managers must have the relevant knowledge for the provision of the financial services under the licence. This includes knowledge about:

  • the financial products and services authorised by the licence;
  • licensee obligations; and
  • the responsibilities of a Responsible Manager.

In Regulatory Guide 105 Licensing: Organisational Competence (RG105), ASIC provides a number of options whereby applicants can demonstrate organisational competence. FEP has significant experience in this area. We have worked with large major banks, specialised fund managers and small boutique houses. We have also worked with many clients under a ‘key person’ licence condition.

How can we help?

RG 105.48 states “You need to be able to demonstrate that each of your responsible managers has appropriate knowledge and skills for their role in your business”.

Depending on your relevant experience and qualifications, we can assist with either an Individual Assessment via Option 2 or a relevant short industry course via Option 3.

Financial Education Professionals is an ASIC authorised assessor for the purposes of RG146 & RG105.

OptionsKnowledge component
(qualifications, training)
Skills component
Option 2Be individually assessed by an authorised assessor as having relevant knowledge equivalent to a diploma5 years relevant experience over past 8 years
Option 3Hold a university degree in a relevant discipline and complete a relevant short industry course3 years relevant experience over past 5 years

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Do Responsible Managers require CPD?

ASIC requires that licensees regularly review and update the competence to provide financial services. This means that Responsible Managers must maintain and update their knowledge and skills.

All Responsible Managers should complete CPD hours each year. We offer online CPD courses specifically designed to assist Responsible Managers in meeting this obligation.

We also offer tailored, in-house Responsible Manager workshops.  Please contact us at enquiries@financialeducation.com.au for further information.

Very thorough information and highly relevant to that of a RM. Very practical and informative, I walked away with far greater knowledge of very relevant industry information. Peter McGuire, XM.com

What if your nominated Responsible Manager has overseas experience only?

Regulation of Australian Financial Services

If your nominated Responsible Manager has been working outside Australia in recent years, ASIC may seek specific demonstration of knowledge of the regulation of Australian financial services. We offer a short course, Regulation of Australian Financial Services, which has been designed specifically to meet this need.

If you operate a custodial service, you need to have at least one Responsible Manager with knowledge and skills in relation to the financial service you provide.  We offer a specialist short course Introduction to Custody which meets this requirement.

Responsible managers – a first line of defence worth investing inRead our CEO’s insights: Responsible managers – a first line of defence worth investing in
Posted by Kate Whiteley on Jan 25, 2019 11:34:35 AM

What makes an RM, an RM? Hint…it’s not just the title. Far from the sometime treatment as a ‘tacked-on’ role, responsible managers as a first line of defence are worth investing in.

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