The inquiry’s remit has also been expanded to include other major financial institutions and financial services associations, in addition to the inquiry into the four major banks, which was announced in 2016.

“The royal commission highlighted widespread misconduct across the financial sector,” Treasurer Josh Frydenberg said.

“Commissioner [Kenneth] Hayne made clear that primary responsibility for misconduct in the financial sector lies with the institutions concerned and their boards and senior management.”

Mr Frydenberg noted that of the 76 recommendations handed down by commissioner Hayne, 10 were directed to the financial services industry.

“This inquiry will help provide further transparency to the public in the work financial institutions are undertaking to implement recommendations from the royal commission and in doing so will contribute to restoring the community’s trust in the sector,” he added.

According to Mr Frydenberg, the government has asked the inquiry to commence “as soon as possible”, but an official date has not been set.

“The government is taking action on all 76 recommendations contained in the final report of the royal commission and will continue to take the necessary steps to restore trust in Australia’s financial system,” Mr Frydenberg concluded.

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Among the recommendations of the banking royal commission was a scrapping of the commission-based remuneration model in the broking industry and the introduction of a best interests duty.

However, the Coalition government has opted to preserve the status quo in the remuneration model, with a review of upfront and trailing commissions to take place in 2022.

The industry is currently working on the implementation of a best interests duty.

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