Isn't it strange how people's perception of a job or a profession can alter over time. When I first entered the world of stockbroking in the early 1960s, I believed I was joining an elite band of professionals charged with oiling the wheels of capitalism. Stockbrokers were monied and lived in big houses – or at least that is how I saw them. Looking from the inside, I formed a rather different – and altogether more realistic – impression.
Moving into fund management at a merchant bank, I was disappointed when an accountant friend of mine accused me of joining the ranks of the affable idiots. So stung was I by his remarks that they have remained with me over more than 30 years. Yet the merchant bankers I met in those difficult days that followed the savage bear market of 1973/74 were certainly affable but by no means idiots.
The 1980s did little for the perception of the financial services industry. Various and well-publicised scandals started the long decline in the reputation of those whose business it was to dispense financial advice. Even on the wholesale side, the image was little better. “Greed is Good” encapsulated the image of a new breed of city operator solely concerned with personal gain. Working in a leading stockbroking firm, it felt different. Nevertheless, I recall a senior stockbroker lamenting that the outside world's perception placed him below badger gassers.
I was put in mind of this change when reading an article reporting on a corporate communications conference dealing with the topic of reputation. Reference was made to a Harris survey in the US last May where people were asked which professions they trusted most. By netting the negative views from those that were positive, a league table was produced giving what amounted to a net trust figure. Those most trusted had a positive score. If people did not hold you in high esteem, your score was negative. Journalists, lawyers and stockbrokers all came out with negative scores. Stockbrokers, at -43 per cent were the worst of the three.
Of course, events outside our control have not helped people's attitude. The long bear market that ushered in the new millennium will have undermined confidence in financial assets. The considerable publicity given to such important issues as the pension crisis clearly does not help.
Those instances of misselling where the opportunity to obtain extravagant rewards appear to have outweighed the probity of the advice are unforgivable but, even here, hindsight plays its part. Until the bear market kicked in, I suggest most people with endowment policies would have been very satisfied with the results achieved. The difference for me of those endowment policies due to mature shortly and those which were paid out in the late 1990s is very significant indeed and cannot be entirely accounted for by the fall in the stock market over the intervening period.
Rebuilding reputations is a long, slow struggle. Given that DIY financial planning can be a risky business, the role of the competent, knowledgeable and trustworthy adviser seems assured. But we still need to make certain that the general public recognise the qualities and virtues that are available in the financial services industry. If they do not, then the problem of bridging the savings gap will never be solved.