ASIC has released a report outlining the findings of its extensive review of how the funds management industry manages conflicts of interest. ASIC said it was specifically concerned about entities with a vertically integrated business - that is, those entities which operate at least two of funds management, responsible entity, superannuation trustee, platform structure (IDPS and IDPS-like structure), investment administration and custody business. In a media release, ASIC said its view was that "these models may create more opportunity for conflict to arise."The two-stage review involved 12 significant participants in the funds management industry. Although it did not look at deposit taking, insurance, financial advice and product manufacturing businesses, ASIC said it was "informed by our other work on conduct risk and culture, for example, in the investment banking space."ASIC Commissioner Greg Tanzer said the reviews revealed "good examples of companies committed to conflicts management."However, it is clear that some organisations adopt a generic template conflicts policy, with no demonstrated commitment to the conflicts management in the organisation. "We saw some very real examples where the conflict in question was so fundamental that complete avoidance was necessary - the conflict could simply not be managed internally and disclosed externally.'We consider that a failure to identify and manage conflicts of interest may lead to significant breaches of the Corporations Act and fiduciary duties, and result in reputational and financial damage', Tanzer said.