5 Lessons Learnt From the Global Complaints Landscape
December 10, 2020
Australians in dispute with their bank, insurer, super fund or financial firm lodged 80,546 complaints with the Australian Financial Complaints Authority (AFCA) between July 1, 2019 and June 30, 2020, representing a 13.7% increase in monthly complaints compared to the previous financial year. This total is only set to rise with predictions that the ongoing coronavirus pandemic will cause a surge in complaints. The renewed focus on complaint management by the Australian Securities and Investment Commission (ASIC) is also increasing awareness of how complaints should be handled by organizations and exactly how consumers can complain.
But this doesn’t have to cause a headache for your organization. While ASIC’s much-anticipated Regulatory Guide 271 on Internal Dispute Resolution (IDR) serves to shine a light on complaint management, Australia is not the first region in the world to address the issue. To a certain extent, the Financial Conduct Authority (FCA) in the UK has led the charge in regulating complaint management and mandating businesses’ obligations to their customers. This means that others have been there and done that, highlighting the challenges you should look out for.
So what lessons can be learned from what’s gone before?
1. Regulators will use their powers
There are no hard and fast rules as to which companies have been found in breach of complaint management regulatory requirements. The ones to hit the headlines are more well-known brands, but that doesn’t mean smaller companies aren’t liable too. Enforcement agencies are more inclined to set an example in the early days of any new or updated regulatory requirements, with little or no room for interpretation.
2. Consider your reputation
As per the Corporations Act 2001, the maximum fine for violating RG 271 is $11.1 million! And whilst some organizations persist in thinking that paying a fine is less expensive than being compliant, regardless of the sums involved, increasingly savvy consumers know their rights and expect their suppliers to honour them. Failure to do so can cause irreparable reputational damage, which can prove far more costly than a fine in the long term.
3. Rapidly changing compliance
Compliance can change very rapidly, as Australian financial services firms know all too well having seen RG 165 evolve into RG 271 in 2020. It’s imperative that firms stay current with the latest regulatory requirements while ensuring their systems and processes are robust yet flexible enough to adapt quickly. And when we talk about effective complaint management, it isn’t just the responsibility of one team. The entire business needs to know what’s expected and what it takes to achieve compliance, making collaborative working a necessity.
4. Make the most of the technology available
Companies can no longer depend on spreadsheets and departmental systems to manage complaints effectively. All customer interactions generate data and it’s vital that this information is recorded as accurately as possible in one central place. The technology is out there to help manage all customer data within relevant, localised and auditable compliance frameworks, providing that all-important audit trail for complaint management transparency.
5. Compliance can be a real enabler of change
Robust complaint management compliance ultimately delivers the levels of customer service that consumers expect, enhancing the overall customer experience and boosting customer loyalty. Compliance need not be a chore. Instead, it can help establish complaint management best practice and put your business head and shoulders above the rest in an increasingly competitive marketplace.
For more information on how you can benefit from Aptean’s experience in complaint management compliance, contact us, we’d love to talk.