The implementation of the Retail Distribution Review presents the financial planning profession with a real opportunity to change consumer perceptions and build both awareness and trust in the profession as a whole.
It has been an incredible achievement for an entire market to move to a higher standard in a relatively short space of time and, importantly, this achievement, coupled with a significant regulatory and market development, presents us with a tangible opportunity to establish recognition and improve confidence.
Whilst the vast majority of individual clients trust their adviser to act in their best interests the same clients generally have little trust in other advisers or the profession in general. Consumer research provides evidence that retail financial services are viewed with suspicion and a lack of trust, which is something we need to change.
Advisers tend to be critical of one another, whether it's about different charging models, independence versus restricted or simple a hunch that adviser poor practice is still rife. Some advisers are also happy to go public in deriding their peers on anecdotal evidence of churning, miss-selling or other misdemeanours, with few able to offer any actual evidence. You would rarely hear a legal adviser accepting that wrong doing existed to any relevant extent within their profession; indeed, a Lawyer would instinctively defend their profession against criticism to avoid all Lawyers unintentionally being tarred with the same brush.
It is important to recognise the unintended consequence of public criticism as contributing to the erosion of confidence and trust in the entire profession. And it's not just consumer perceptions that are impacted, the regulator and other professions are also looking inward.
Uniting behind professionalism
It is high time that the industry put aside its differences and made consumers aware of the higher standards of professionalism that the RDR has achieved. We need to unify and get our own house in order - by demonstrating confidence and respect in our own profession will ultimately influence external audiences looking in. The potential benefits are immense:
- Constructive and balanced blog comment - national consumer press scan the trade press, blogs and social media sites
- Better engagement with the regulator - a change in behaviour will help influence the FCA
- Potential regulatory recognition, which could lead to a less intrusive supervisory oversight
- Greater recognition and referrals from other professions and consumer bodies
- More graduates and new entrants attracted to the profession
- Professional image, which will secure higher consumer confidence & trust
Greater opportunities for all
Our ultimate ambition must be to create a more vibrant financial planning sector that is well thought of and highly trusted. More consumers will seek professional financial advice and be confident in paying for the expertise of highly qualified and ethical adviser. Good consumer outcomes will be positively perceived by all stakeholders and result in a reinvigorated sector offering opportunities for all.
Numerous advisers and advisory firms have already formally added their support to the campaign, including: