Page 101 - Profiles's Unit Trusts & Collective Investments - September 2024

Legislation and Guidelines

their agents. The TCF principles represent the best way to build a relationship of trust with clients
and to achieve a sustainable long-term business model. A key feature of TCF is a top-down
approach which tasks business leaders and senior managers with creating a culture of good service
rather than a delegated ‘tick box’ compliance approach.
TCF goes beyond customer satisfaction. The fact that customers are satisfied does not
necessarily mean they have been treated fairly – satisfaction might be due to ignorance, distorted
expectations, or even misleading information given by the service provider.
In applying TCF, companies should seek to achieve six key outcomes, which are encapsulated in
the mindset: doing things right and doing the right thing. The key objectives can be summarised as follows:

OBJECTIVE OUTCOME
Right Culture and Governance TCF is entrenched in the organisation so that the fair treatment
of customers is central to corporate culture
Right Targeting and Product Suitability Products are correctly designed for specifically identified
consumer groups and sold only to the targeted groups
Right Information and Disclosure Straightforward information is provided and customers are kept
informed prior to, during and after the sale
Right Advice The provision of suitable advice that takes into account
customers’ circumstances
Right Delivery Products are supplied that meet customer expectations and live
up to promises made in terms of performance and service levels
Right Post-Sale Treatment Product switches, customer queries and service complaints are
facilitated without the imposition of undue administrative barriers
In December 2014 the National Treasury issued an updated discussion document titled Treating
Customers Fairly in the Financial Sector: a market conduct policy framework for South Africa. The FSCA’s
TCF initiative is part of the regulatory initiative spearheaded by the FSR Act. The TCF principles
underpin the FSCA’s General Code of Conduct (GCOC) and are one of the building blocks of the
draft COFI bill.
At a practical level, the TCF principles are being incorporated into the new regulatory
structures evolving under the FSR Act and the COFI Act – TCF will not exist as a separate piece of
legislation. In the words of Caroline Da Silva, the former head of the FSCA, the TCF objectives are
“the guiding principles that the FSCA will use to design both our regulatory as well as supervisory
frameworks to ensure that financial institutions will indeed prioritise these outcomes”.

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