Has your business grown since the Responsible Manager
(RM) resources were last reviewed?
You'd be surprised at the number of businesses that are not
aware of who their RMs are. Resourcing, including organisational
competence needs to respond to business growth and development.
Tip: review your compliance resources to determine whether
the current RMs are able to adequately oversee the provision of
financial services, given the current size of the
Is your RM your CEO (or Senior
We see many businesses where the CEO/Managing Director is the
RM. Whilst this may be appropriate for a small-scale advisory
business, in larger businesses, ASIC implies that the RM position
is more suited to middle-management.
The test: does your RM oversee the day-to-day decisions
regarding the provision of financial services in the
How do they do this, and where is it documented?
Note: this test is confined to the provision of financial
services, not strategic direction, or
non-financial services aspects of the business.
Do you have Key Person risk?
Many licensees have a key person condition on their licence.
This person is an RM and a key person. A key person condition means
that if the key person was to leave the business, the business is
no longer competent and the licensee would have 5 business days to
nominate a new and suitable key person, or explain to ASIC why it
has not nominated a key person.
These situations, when not planned for, can quickly result in
the licensee being in breach of the key person requirement on its
Tip: ASIC may remove key person conditions in certain
circumstances - such as appointment of multiple experienced RMs,
combined with an application to ASIC for removal of the key
Is your RM undergoing regular training relevant to
If you're unsure of the health of your RM resources, or
you'd like to take it a step further, contact us, and we'd be
happy to discuss your RM needs.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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