4th October 2013
Regulatory & Investment Change
2013 is a year of major regulatory change for the wealth management, retail fund management and the advisory sectors. The investment landscape is proving more positive but still fragile, but how are the clients responding to these challenges?
The wealth industry is very variable when it comes to taking the temperature of their clients’ opinions. At one end statistically valid samples are taken on an annual, quarterly or even monthly basis, while firms at the other end rely exclusively on feedback from their client-facing people. Even those who poll significant numbers of their clients on a regular basis will not gain market-wide insights in what is a crucial year of change. This insight is vital, not just from a strategic business perspective, but also to prove to the regulator wealth firms know their clients’ requirements and are fulfilling them.
Hence ComPeer is undertaking a major research exercise with 1,000 investors, split between high net worth (£1m+ of investable assets), affluent (£250k - £1m) and mass affluent (£50k - £250k), sponsored by EY. We will be asking about their knowledge and awareness of regulatory changes and how it has affected the services they receive from their wealth managers and financial advisers. How have they adapted post-RDR to a changed environment for advice, is there now greater interest in self-directed or discretionary investment? Do investors believe the new regulations are working for their benefit? How do today’s investors choose their wealth manager or adviser and what makes them stay as a client? Have their relationships changed via the type and frequency of meetings, the reports they receive and the fees they now pay? Will this result in more client switching between wealth managers, advisers and self-directed investment? Has this new environment affected their investment preferences and risk profile?
Last year ComPeer was able to compare the opinions of wealth management firm CEOs with those of individual investors and identified a wide gulf in the relative importance placed on investment performance, fees charged and the relationship between investors and their wealth managers. We will be investigating whether RDR’s introduction has narrowed this gulf.
The results will also demonstrate the differences between the way those at the mass affluent end are being treated and their high net worth counterparts. It used to be accepted wisdom that those who could afford advice would always take advantage of that fact, but has the increasing amount of information available on execution only websites changed that permanently? The execution only sector has prospered in 2013 – how much of this is due to an emerging advice gap? Is the availability of an online discretionary service for anyone with £1000 upwards altering perceptions?
We will also be researching the views of wealth managers, private bankers, advisers and retail fund managers as to how they have adapted to the new environment; the successes, the problems still causing frustration and their relationships with the regulator and their clients. Where appropriate there will be comparisons between the views of the industry and their clients, the differences highlighted and the consequences of those differences discussed. When asked how, in this changed world, relationships with their clients had altered, one CEO of a wealth management firm replied “we used to say we were client-centric, but now we really mean it!” We will see how many of his counterparts ‘mean it’.
The results of this research will be presented back to ComPeer’s Regulatory & Investment Change Conference on the 26th November.
In addition to the presentation of research the conference will host senior speakers from the key industry bodies including the Financial Conduct Authority, BBA, APCIMS, APFA and IMA, all of whom will be providing their views on the change of regulatory landscape and the ramifications for the industry. Also speaking will be top economist, Roger Bootle, Anthony Hilton the award winning financial journalist from the Evening Standard and Alex Sullivan, Publishing Director of Compeer’s partner, IFA Magazine. Alex will be presenting the adviser community’s thoughts on their changed client environment. Gina Miller, co-founder of the True and Fair Campaign, will be challenging the industry to be more transparent.
Panacea Adviser members can benefit from a 20% discount off the £300 delegate price – just follow the link below and enter Panacea20 in the voucher code box.
http://www.compeer.co.uk/event/regulatory--investment-change-the-clients-view-12.htm
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