The IEC, to be established before the end of 2012, will “build upon the SFC’s statutory investor education mandate to cover a broad spectrum of financial consumer needs in Hong Kong, with the ultimate aim of improving the public’s financial capability,” he stated in the last edition of the SEC’s investment newsletter InvestEd Intelligence.
The good news here for financial advisers in Hong Kong is that if Wong’s aim is achieved, the value of advice given by professionals in financial planning is likely to be more readily understood and appreciated.
Wong argued that the IEC “aspires to enhance the public’s understanding and knowledge of all types of financial products and services on offer, as well as raising the level of personal financial management skills,” he stated in the last edition of the SEC’s investment newsletter InvestEd Intelligence.
It will supplement the various measures implemented over the past few years to deal with new products, market risk and consumer issues that arise when dealing with financial intermediaries, Fong added.
Back in December 2010 Secretary for Financial Services and the Treasury, Professor K C Chan announced the authorisation of the SFC to establish the IEC, allowing the SFC’s remit on investor education to be broadened to cover financial products and services other than those in the securities and futures sector.
Chan stressed then that the establishment of an IEC would increase the public’s confidence in financial institutions.
Going into more detail about the IEC’s remit, Fong stated that it is more about financial education in general: “The approach is to target not just investors in the conventional sense, but "potential investors" across a wide spectrum of the community’s demographics. During the initial stage of its operation, the IEC will build on the existing education materials on banking, securities and other financial services and products. Over time, it will also go beyond product-specific matters and address financial management issues across all financial sectors.”
He pointed out that as financial markets become more and more complex, people are inevitably are exposed to greater risks: “No matter under which circumstance, knowledge is the best protection. We believe that the IEC will better assist the Hong Kong public in making informed financial decisions and managing their money wisely.”
Fong also urged local investors, when making investment decisions, to make use of recently introduced protective measures governing the sale of retail investment products, such as the product key facts statement, the "cooling-off" period for certain unlisted structured products, the pre-sale assessment of a client’s knowledge of derivatives, and the need for product distributors to disclose their own benefits.
