Treating Customers Fairly Policy

1. Introduction

The governing body of Capital Legacy Solutions (Pty) Ltd (CLS) has taken a decision to formally adopt the Treating Customers Fairly (TCF) outcomes and principles as part of the values of the business. This ensures that each employee embraces and enforces the principles of fairness and objectivity in their daily tasks and the processes of the business.

Our ethos and culture is to:

• Operate with transparency and honesty;
• Empower our customers so they can make informed decisions;
• Aim to “Wow” all customers during our service delivery;
• Work with purpose and as a team, delivering simple and practical solutions to complex problems;
• Accept nothing less than the best for our customers in terms of service, customer-centricity and all business-related communication; and
• Be sensitive to and understanding of our customers’ needs.

2. Objectives

CLS, as an authorised financial services provider, is fully committed to ensuring that our customers are treated fairly at all times.

We undertake to ensure that a culture of TCF is cultivated within our FSP on an ongoing basis. We are focussing our attention on high-quality service delivery, fair treatment of customers and transparency as an organisation.

We undertake to ensure that quality management systems, processes, procedures and controls are formulated, implemented, reviewed and monitored to ensure, as far as possible, that customers experience professional servicing standards and fair treatment on all levels of interaction.

We undertake to provide training and to equip each staff member on the principles contained herein and to be active participants in cultivating the TCF culture, on an ongoing basis.

3. The Six Outcomes of Treating Customers Fairly

As a Financial Services Provider, we embrace the spirit of the principle-based outcomes as published by the Financial Sector Conduct Authority (FSCA) and are committed to and will continuously strive to comply with these outcomes.

Outcome 1

Customers are confident that they are dealing with providers where the fair treatment of customers is central to the FSP’s culture.

Outcome 2

Products and services marketed and sold in the retail market are designed to meet the needs of the identified customer groups and are targeted accordingly.

Outcome 3

Customers are given clear information and are kept appropriately informed before, during and after the time of contracting.

Outcome 4

Where customers receive advice, the advice is suitable and takes account of their circumstances.

Outcome 5

Customers are provided with products that perform as providers have led them to expect, and the associated service is both of an acceptable standard and what they have been led to expect.

Outcome 6

Customers do not face unreasonable post-sale barriers to change product, switch provider, submit a claim or make a complaint.

4. Achieving the Outcomes

We realise that the success of achieving the above-stated outcomes lies in the way we manage our FSP. We are convinced that quality management systems, policies, procedures, controls and appropriate training are necessary for bringing to fruition our best intentions which arise from these Outcomes.

We further agree that each role player within our FSP must embrace the TCF outcomes and understand that each individual contributes to the FSP successfully achieving these Outcomes on a consistent basis and as a collective.

We also aim to demonstrate that we are consistently treating customers fairly through our behaviour and monitoring which is influenced by our governance structures as well as throughout the stages of the product life cycle, which are summarised hereafter.

4.1 Leadership

4.1.1 The TCF objectives have been adopted by CLS Management, who has taken responsibility for them.

4.1.2 Management shall endeavour to conduct regular reviews of the main business processes to identify areas that require improvement with regards to the TCF outcomes.

4.1.3 The TCF objectives shall be communicated to all staff across the business.

4.1.4 A process for assessing staff and Management’s understanding of TCF and the Organisation’s TCF commitments will be established and implemented.

4.1.5 Staff and representatives who contribute to the provision of financial services to retail customers are required to understand their roles in delivering TCF outcomes to customers.

4.1.6 We have incorporated the TCF outcomes as part of our Vision, Mission and Values Statement.

4.2 Strategy

The TCF objectives will be included in the FSP’s strategic planning process, therefore provision for the TCF objectives will be made in any new strategy or change in strategy and the FSP’s strategic plan will include the TCF deliverables.

4.3 Decision-making

4.3.1 We will consider TCF objectives when taking decisions in all business cases or projects (including expenditure) undertaken by CLS.

4.3.2 We have established an internal TCF forum for the purpose of providing an opportunity for all role-players within our FSP to raise any questions or concerns regarding TCF-related matters and engage in healthy debate thereof.

4.4 Governance and Controls

4.4.1 Oversight and monitoring of the TCF outcomes has been assigned to our internal TCF forum as well as an external compliance service provider.

4.4.2 CLS shall formulate, implement, regularly review and monitor processes:

4.4.2.1 to ensure formal and regular reporting of the implementation progress of TCF deliverables; and

4.4.2.2 to identify and report TCF risks or failures.

4.4.3 The Management and shall be formally included in the Risk Management Framework of CLS.

4.4.4 The CLS Governance Framework shall be evaluated on a continuous basis to ensure that it is effective in achieving the TCF outcomes.

4.5 Performance Management

4.5.1 Staff members who will be responsible for the delivery of the TCF outcomes within CLS have been identified.

4.5.2 A performance evaluation criteria into which the TCF objectives are incorporated will be formulated and implemented and will be applied rigorously at all levels.

4.5.3 All staff members are required to undergo continuous training on TCF principles, standards and deliverables.

4.5.4 Recruitment processes have been formulated, will be kept up-to-date and are implemented on an ongoing basis to ensure staff in relevant positions will have the necessary skills to deliver the FSP’s TCF objectives.

4.6 Reward

4.6.1 CLS may formulate remuneration and incentive schemes that are meaningfully linked to the achievement of TCF objectives, at all levels.

4.6.2 Reward and recognition processes may be formulated and implemented to complement TCF objectives.

4.6.3 Meaningful consequences (such as retraining, re-assignment or disciplinary action) for staff and Management who do not achieve agreed TCF deliverables will be implemented.

4.7 Measurement and Management Information

4.7.1 Management Information (MI) measures are being designed and implemented for TCF monitoring.

4.7.2 CLS will establish processes to obtain MI on customer expectations and how these expectations are being met by CLS.

4.7.3 Processes are to be formulated and implemented to collate and summarise TCF-related MI in a meaningful way that provides a complete overview of CLS’s progress in meeting the TCF outcomes in its interactions with customers, including, but not limited to, concrete examples of such progress.

4.7.4 Processes are to be formulated and implemented to enable CLS to analyse and act on MI findings to improve TCF outcomes for customers.

4.7.5 MI findings will be analysed to identify staff training needs and will be used for performance management purposes.

4.7.6 CLS shall communicate transparently with our stakeholders (including the Market Conduct Regulator) on our progress in achieving TCF outcomes and will make information regarding our progress publicly available.

4.7.7 Over and above “business as usual” MI, CLS shall have mechanisms in place to monitor and respond to changes in the broader environment, to enable us to pro-actively identify TCF-related risks.

4.7.8 CLS will provide concrete examples, supported by MI, of improvement in our delivery of TCF outcomes to customers, particularly in respect to products and services.

4.8 Products and Services

4.8.1 CLS has created a product to distribute and administer, that identifies with a particular customer group(s).

4.8.2 Most importantly, CLS has assessed the product information to determine whether such material is suitable for the identified customer group.

4.8.3 CLS shall ensure that staff and representatives are provided with appropriate information regarding which customer groups the product suits.

4.8.4 CLS is satisfied that our distribution and/or administration methods are suitable for the product and target market.

4.8.5 Our product-approval and product-selection process includes Senior Management’s affirmation that our product adequately meets the TCF outcomes, including the requirement that it will perform as customers are led to expect.

4.8.6 CLS shall formulate, implement, regularly review and monitor our product-selection and product-approval process (including any add-on products) which includes an assessment and sign-off of the suitability of promotional or other material for the identified customer group. This process shall also ensure fair treatment of customers with regard to customer incentives, such as loyalty programmes, bonuses or discounts, including mitigating any conflict of interest risks.

4.8.7 CLS shall formulate, implement, regularly review and monitor processes to:

4.8.7.1 evaluate the financial understanding of products and services by customers;

4.8.7.2 mitigate risks where it becomes apparent that our product or distribution and/or administration method is not suitable for the identified customer group, or has been distributed to inappropriate customer target groups;

4.8.7.3 mitigate risks that our product or service may pose to particular customer groups;

4.8.7.4 monitor and analyse routine complaints and communicate them to Management and stakeholders alike;

4.8.7.5 to rectify a situation in which it becomes apparent that any product information already in circulation (whether produced by our FSP, or not) is inaccurate, unclear, unfair or misleading; and

4.8.7.6 review the range of products we distribute and administer that includes our TCF objectives.

4.9 Clear and Appropriate Information

4.9.1 CLS shall assess the clarity, appropriateness and fairness of product information provided to customers, whether produced by CLS, or third parties, in order to ensure that any information we provide regarding our products or services is accurate, clear, fair and not misleading.

4.9.2 CLS shall formulate, implement, regularly review and monitor an approval process for all product-related information for which compulsory sign-off by Senior Management is required.

4.9.3 CLS has produced its own product information, therefore we will test the clarity of the information with the target audience before issuing it.

4.9.4 CLS has designed products which may be distributed by other FSPs. CLS shall implement a risk mitigation process to monitor whether any inaccurate, unfair or misleading information about our products or services are provided by third parties.

4.9.5 CLS will rectify the situation where it becomes apparent that any product information already in circulation (whether produced by us or not) is inaccurate, unclear, unfair or misleading.

4.9.6 CLS shall regularly review standardised product information (whether produced by us or not) to ensure that it remains accurate, clear and appropriate to the applicable customer groups.

4.9.7 CLS is required to monitor and act on feedback, complaints and suggestions received from customers, staff or any other interested party that identifies the need for improvement in our product information.

4.9.8 CLS shall ensure that relevant and adequate product information is provided to customers (whether by our own staff/representatives or by third parties) at an appropriate time, to enable them to make an informed decision about entering into the relevant contract.

4.9.9 CLS is required to provide existing customers with key information on their chosen products on a regular, ongoing basis after contracting, through appropriate channels.

4.9.10 CLS commits to ensure that customers are informed of any recent or pending changes to the products, contractual events or any actions required from them, well ahead of time, to enable them to reasonably respond to or act on the information.

4.9.11 CLS shall control the accuracy and quality of any once-off or non-standard product information provided by staff or representatives.

4.9.12 CLS is required to maintain up-to-date contact details of existing customers.

4.9.13 CLS commits to ensure that our customers have current and accessible contact points if they need product or service information or need to get in touch with CLS for any reason whatsoever.

4.9.14 CLS is required to ensure that accurate, retrievable, secure records are maintained of all product information which has been provided to customers and any other material interactions with customers.

4.10 Advice

4.10.1 Prior to any decision to market a productis required to assess whether or not we have the appropriate skills and business processes in place to provide advice and service that will be suitable for our target market and product concerned.

4.10.2 Prior to contracting with any intermediaries to market our products, CLS shall conduct full due diligence customer research and appropriate testing to ensure that we are appropriately content that such products and service levels are likely to meet our customers reasonable expectations.

4.10.3 CLS will ensure that all representatives are provided with adequate training on the specific products to enable them to provide suitable advice on the specified products.

4.10.4 CLS is required to design and implement controls to prevent representatives providing advice on products on which they do not have adequate product training.

4.10.5 Prior to contracting with any other FSP, CLS must make satisfactory arrangements to ensure that the FSP and its representatives will have reasonable access to any product information required in order to provide suitable advice.

4.10.6 CLS shall monitor and act on feedback or complaints received from customers or third parties regarding the quality of advice they have received from our representatives, to identify any training needs and/or risk of inappropriate advice.

4.10.7 Processes shall be formulated and implemented to identify instances and mitigate the risk to customers when our representatives have provided inappropriate advice or misleading information to customers.

4.10.8 Over and above complaints, CLS is required to monitor potential TCF indicators such as insurance claims experience, product retention, early termination data, investment portfolio switching, type and frequency of product changes, etc. in relation to the customers associated with our representatives, to identify and mitigate risks of inappropriate advice or poor customer service outcomes attributable to the representatives concerned.

4.10.9 CLS is required to provide intermediaries and third parties in the customer value chain with feedback in relation to any aspects of our products or services which inhibit our ability to provide suitable advice or delivery of TCF outcomes to customers.

4.10.10 CLS must formulate and implement controls to identify and address any conflict of interest between ourselves and our customers.

4.10.11 Incentive and remuneration targets are to include clear TCF measures that our representatives are required to satisfy.

4.10.12 Agreements between CLS and any other FSP must clearly set out the parties’ respective responsibilities in relation to providing customers with advice, information and service support. Customers must be able to understand who they should communicate with for different aspects of the financial products or service provided to them.

4.10.13 CLS is required to formulate and implement controls to identify and act on instances where our intermediaries have provided advice that they are not authorised to provide, either in terms of their specific contract or mandate with us and/or with any intermediary, or as a result of non-compliance with our FAIS licence conditions or other legal requirements.

4.10.14 CLS will formulate and implement a fair Compensation Policy for the compensation of customers who have been financially prejudiced as a result of inappropriate advice or poor service provided by our representatives or ourselves.

4.10.15 CLS will ensure that published decisions of the FAIS Ombud, guidance from the regulators and other relevant information sources in relation to advice practices are analysed by Management to evaluate whether our existing practices remain relevant and effective.

4.11 Product Performance Expectations

4.11.1 CLS will thoroughly analyse the product retention, portfolio switching, early termination behaviour of our customers to identify potential risks where products or services are not meeting the created expectations.

4.11.2 CLS shall formulate and implement:

4.11.2.1 processes to alert customers to the risks of particular actions on their part (such as early termination, non-payment of contributions, investment portfolio switches, benefit reductions) in a reasonable time frame for them to respond to or act on the information;

4.11.2.2 processes to alert customers to the risks of non-action on their part, such as a failure to review insurance cover needs, investment goals and risk profiles, beneficiary nominations and other relevant requirements;

4.11.2.3 clear service standards for customer service processes which will be communicated to customers; and

4.11.2.4 processes to protect the confidentiality of all customer information.

4.11.3 CLS may conduct research or test the FSP’s service standards to determine whether we are in line with Customer expectations.

4.11.4 Although CLS explicitly cannot accept responsibility for the performance of products or of intermediaries, processes are to be formulated and implemented to mitigate the risks to our customers when it becomes apparent that products are not performing or are unlikely to perform as customers have been led to expect.

4.12 Changing Products

4.12.1 CLS commits to ensure that customers are informed (in good time, not only upon request) of the types of changes they may make to their products if their needs or circumstances change and of any important limitations on their ability to access funds or make changes.

4.12.2 CLS is required to ensure that when we become aware of a change in a customer’s need or circumstances (including affordability difficulties) that they are informed of possible changes they may consider to meet their new requirements.

4.12.3 CLS has clear service standards in place for processing product changes (including where we need to refer the request to another party to deal with) and these are communicated to our customers.

4.12.4 Where a request for a product change is declined by any party in the value chain, CLS will advise the customer and provide clear reasons for this denial.

4.12.5 When a request is received to change a product (whether directly or through a third party), CLS is required to inform the customer of any potential risks associated with the change, in reasonable time, for the customer to respond to or act on the information.

4.13 Switching Providers

4.13.1 CLS has and will continue to have clear service standards in place for processing conversion to other providers which form part of the customer servicing mandate.

4.13.2 When we receive a request to switch providers (whether directly or through a third party), CLS shall inform the customer of any potential risks associated with the switch.

4.14 Claims and Disbursement Handling

4.14.1 CLS commits to ensure that customers are informed of how to submit a claim or disbursement request, of our service standards for claims and disbursement processing, and what information we will need to process the claim or request.

4.14.2 CLS will ensure that customers are informed prior to contracting, of the circumstances under which claims or disbursement requests will not be processed and will ensure that the customers’ obligations are explained.

4.14.3 CLS commits to ensure that once a claim is received that customers are constantly informed of progress.

4.14.4 CLS will analyse the types of claims and claims repudiation experience, of our different representatives, to identify any miss-selling risks.

4.15 Complaints Handling

4.15.1 Our complaints process has been tested to ensure it is accessible and appropriate for our customer groups.

4.15.2 CLS will implement a robust Complaints Management, Record-keeping and Root Cause Analysis process.

4.15.3 CLS commits to ensure that customers are informed (before complaints stage) of how to lodge a complaint and of the options for further recourse if they are dissatisfied with the outcome of a complaint resolution.

4.15.4 CLS may benchmark our Complaints Handling Procedure (volumes, resolution rates, Ombud complaints) against competitors.

4.15.5 CLS commits to ensure that once a complaint is received, we keep the customer informed of the progress (including the contact person’s details) regardless of whether we are dealing with the complaint ourselves or have referred it to a third party.

4.15.6 CLS will, when responding to a complaint, endeavour to provide clear reasons for our response (including when the response is favourable to the customer) with supporting evidence where relevant.

4.15.7 CLS will ensure that where a request for redress is declined, wholly or partially, we inform the customer of what steps they may take to have the decision reviewed.

4.15.8 CLS has clear service standards in place for processing complaints and ensures that these are communicated to our customers.

4.15.9 CLS will ensure that continuous specific training is provided to staff who are tasked with processing complaints.

4.15.10 CLS has ensured that its complaints process is structured to ensure that decisions taken will be objective, fair, consistent for similar complaints, and that decision-makers do not have a conflict of interest.

4.15.11 CLS may implement follow-up processes to determine customer satisfaction levels after complaints are finalised.

4.15.12 CLS is required to implement processes to ensure consistency in the handling of complaints.

4.15.13 CLS will put a Compensation Policy in place for fair compensation of customers who have been financially prejudiced by unfair treatment, and this policy will not be limited to customers who complain.

4.15.14 CLS will analyse complaints to identify any risks of miss-selling by representatives.

4.15.15 CLS is required to consider the nature of complaints received and the complaints handling performance of different product suppliers when deciding whether to do business with them or recommend them or their products to customers.

5. Ownership and Accountability

This policy is owned by Capital Legacy Solutions (Pty) Ltd, an authorised financial services provider in terms of the Financial Advisory and Intermediary Services Act (37 of 2002). Capital Legacy Solutions (Pty) Ltd accepts responsibility for the successful implementation of the Treating Customers Fairly processes, procedures and controls in respect of the TCF outcomes and objectives.

As Key Individual of the provider, Eduann Louis Vorster, hereby confirms the adoption of the policy.