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Legislation in Relationship Management: Financical Services

Written activity 

1. Legislation, Regulation and Industry/Professional Codes of Practice That Apply To Relationship Management.

Identify and outline the key requirements of the legislation, regulation and industry/professional codes of practice that apply to relationship management. That are relevant and that apply to relationship management in the financial services industry. 

This task must be completed within 45 minutes.

2. Effective Interpersonal Skills, Negotiation and Communication Principles.

Describe how to effectively use interpersonal skills, negotiation and communication principles in interactions with others in the workplace.

This task must be completed within 20 minutes.

3. Relevant Associations, Conferences and Other Relationship Building Opportunities.

Using your workplace, or the workplace in which you would like to work as the basis for this task, develop a list of the associations, conferences and other relationship building opportunities that are relevant to your role. 

My Response was

Legislation and Regulation of the financial Services Industry

The regulation and legislation related to the activities of a relationship manager in the financial industry is based on the stipulated standards of the Financial Planning Association. As a relationship manager, the most critical area in this section is on how to deal with complaints. As  clients come to offer their complaints, it lies upon the manager to go ahead and provide an opportunity for the client to be listened to before progressing to forward the issue to the relevant department and following up till the issue is resolved (FPA 2018). In most cases, the customers may be suffering due to their lack of understanding how the financial organization operates. By this, there is a need for the financial manager to set up mechanisms that allow the customers to be well-educated on the financial perspectives of the making of the organization as this also helps them in decision making. 

FPA. (2018). The Financial Planning Association; Australia: Standards and Principles. Retrieved from: https://fpa.com.au/ 

Effective Interpersonal Skills, Negotiation and Communication Principles

The interaction with others is an important aspect of the organization since all; the task relies on the interaction with workmates. Verbal communication is the most important since it allows for the understanding between me and the others. A perfect choice of words, intonation and signs will enhance my verbal communication techniques in fostering understanding. 

The work place is also merged with misunderstandings and this will call upon my interpersonal skills of problem solving. In ensuring that there is a balance in the solving of conflicts and while still maintaining my balance, I always try to be assertive in what I stand for. The utilization of bargaining approaches will allow me to ensure that both parties have ended up agreeing. 

Relevant Associations, Conferences and Other Relationship Building Opportunities

The expounding of my roles as a relationship manger is made better through the being involved in activities associated with my role.  These include: 

  • Financial Management Association of Australia
  • Financial Planning Association of  Australia
  • Australia Finance Review Summit
  • 28th Annual Credit Law Summit
  • The Australian Financial Review, Banking and Wealth Summit.
  • Australia Finance Review Boss Leadership Summit
  • Banking and Finance Ethics Workshops. 

FeedBack 

For the first question, please include other legislation and/or regulation can impact upon your relationships with your clients.  One of the main items we need to see include in your response is the banking code of practice, and how this effects your relationship with clients.

You should also include any legislation that may affect how you handle client information, particularly when dealing with third parties and other professionals.

If for the second section of the written activity, your response for this section should include descriptions of different interpersonal skills, and style and how these interact with different personalities.  In your response it should also outline the different personality types, and descriptions of these.



Answer

Answer 1

Legislation and Regulation of the financial Services Industry

The regulation and legislation related to the activities of a relationship manager in the financial industry is based on the stipulated standards of the Financial Planning Association. As a relationship manager, the most critical area in this section is on how to deal with complaints. As clients come to offer their complaints, it lies upon the manager to go ahead and provide an opportunity for the client to be listened to before progressing to forward the issue to the relevant department and following up till the issue is resolved (FPA 2018). In most cases, the customers may be suffering due to their lack of understanding how the financial organization operates. By this, there is a need for the financial manager to set up mechanisms that allow the customers to be well educated on the financial perspectives of the making of the organization as this also helps them in decision-making. 

Further, The Banking Code of Practice is one such legislation that influence relationship of financial companies with their clients and act as a self-regulatory element. The industry guideline under the code explains the nature of financial abuse and the way it impact customers and bank’s relationships with their customers. The framework also helps to make people aware while promoting consistent arrangements dealing with suspected cases of financial abuse.

In order to avoid any such abuse, banks and financial institutions use the code of practice to reduce the vulnerable risk for customers; and prevent financial abuse by helping banks minimizing the losses associated through implementation of programs of preventing fraud (ABA, 2017). A key initiative from banks to avoid any misuse of bank account, financial services product or credit facility and timely identification of any financial exploitation of customers help in maintaining trust or dependence between the bank and the customers. Therefore, the Banking Code of Practice is a key instrument to develop trustworthy and healthy relationship with customers. It gives a formal procedure of identifying any abuse and helping the customer in a sensitive manner. The code further provides procedure of administration and guardianship making it possible to help already identified vulnerable customers leading to trustworthy relationship between the financial institution and their customers (ABA, 2017).

Further it is Australian Securities and Investments Commission (ASIC) that protects consumers and maintains market integrity. It defines External Dispute Resolution Schemes (EDRs) through Financial Ombudsman Service (Australia) and Credit and Investment Ombudsman (CIO) that are non-profit organizations responsible for regulating customer relationship with banks and financial institutions (ASIC, 2018). 

It is again ASIC that regulates the handling of client’s information and any third party information as collected by banks and various financial institutions. The regulation from ASIC provides best practice guidelines to implement effective risk management by implementing the ‘need-to-know’ principle and maintaining personal confidentiality obligations and personal account dealing. The guidelines also provide steps that a company should take to minimise the risk of insider trading (ASIC 2015). This is done by ensuring a system of complying with own practices of the company related to handling confidential information, executing specific confidentiality agreements and implementing strict control for ‘beauty parades’ related to adviser’s appointment.

Answer 2

Effective Interpersonal Skills, Negotiation and Communication Principles

The interaction with others is an important aspect of the organization since all; the task relies on the interaction with workmates. Verbal communication is the most important since it allows for the understanding between the others and me. A perfect choice of words, intonation and signs will enhance my verbal communication techniques in fostering understanding. 

The work place is also merged with misunderstandings and this will call upon my interpersonal skills of problem solving. In ensuring that there is a balance in the solving of conflicts and while still maintaining my balance, I always try to be assertive in what I stand for. The utilization of bargaining approaches will allow me to ensure that both parties have ended up agreeing. 

There are several interpersonal skills that interact with different personalities and help leaders and managers at workplace to maintain good relationship with subordinates. These skills are:

  • Verbal communication
  • Non-verbal communication
  • Listening skills
  • Problem-solving skills
  • Decision-making skills
  • Assertiveness
  • Negotiation skills

Good verbal skills are necessary to provide proper instructions and maintain transparent communication across the workplace. Along with verbal communication it is also necessary to focus on non-verbal communications skills including facial expressions, body language, and hand gestures. Leaders and managers use different interpersonal skills as per the extrovert and introvert personalities of people at work (Sims, 2016). 

The big five personality traits are openness, conscientiousness, extraversion/introversion, agreeableness and natural reactions (Sims, 2016). The model can be used to understand people’s personality and match different interpersonal skills to manage the people with different personalities. For example, the trait of openness can be managed with strong communication skills while the person’s extraversion or introversion along with assertiveness has a significant influence on the individual’s willingness to take a lead at workplace. People with good communication skills (verbal and non-verbal) can use their skills to energize and motivate people at work and directing their efforts to company goals Kuntze and Molen, 2016).

Further, active listening skills helps in increasing the feeling of trust and cooperation among employees leading to reduction in turnover and increased commitment to company goals. Strong problem-solving and decision-making skills are necessary to deal with difficult situations like change implementation and management, conflict resolution and dealing with emotional situations (Kuntze and Molen, 2016). These are required to manage personalities full of enthusiasm and assertiveness where they need warmth, positive emotions and gregariousness to move ahead with motivation (Sims, 2016). Finally, strong negotiation skills help in managing the personalities that are volatile (neuroticism) as they need interpersonal skills to manage anxiety vulnerability, impulsiveness and self-consciousness.

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