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Fay Goddard: ‘I do not underestimate the challenges facing advisers’

Fay Goddard 480 Alt

Personal Finance Society chief executive Fay Goddard says she has gone a long way to achieving her “five year vision” for the professional body but adds she does not underestimate the challenges advisers will face post-RDR.

Speaking to Money Marketing today at the PFS annual conference in Birmingham, and following the announcement that she will be stepping down next year, Goddard says five years is the right amount of time to lead an organisation like the PFS.

She says: “I have almost achieved my five year vision for the PFS which was to provide as much help and support for the adviser community to get through the challenges of the RDR, particularly with qualifications, and to help advisers get their statements of professional standing. The membership has done incredibly well on that.

“But it was also to create the chartered profession, to do as much as we could to support the existing chartered membership, to grow it, and to inspire others to want to be chartered. To me it is in its infancy but it is growing and at a rate that is better than I had expected.”

Goddard says during her tenure she has seen “RDR rejecters” reluctantly come around to the idea of improving the profession, and has also seen what she calls “complete converts”.

But she says there are still a host of issues around the RDR that, even at this late stage, still need clarifying.

She says: “I do not underestimate the challenges firms will still face. There is a list of areas I still have concern over regarding the implementation of the RDR. Just because we are supportive of the change in the professional standards it does not mean everything is perfect by a long stretch.

“There have been unintended consequences and there are still a lot of business issues outstanding, such as legacy products, the inconsistency of adviser charging approaches by providers, fund managers and platforms, VAT and numerous other things. It is going to take time to identify these operational issues that still need to be resolved.”

Goddard adds she remains concerned about differences in the way providers choose to facilitate adviser charging, and whether that will end up influencing which products are recommended and bought.

She said: “The worst possible outcome is that you create another kind of bias which does not benefit the consumer. A simple example is company A facilitating adviser charging on an investment bond, and company B doing it in a different way. Will that drive the product selection, and will that be based on what benefits the adviser’s business rather than what is right for the client?”

Goddard will remain as PFS chief executive until a successor is appointed, but expects to have stepped down by March.

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Comments

There are 6 comments at the moment, we would love to hear your opinion too.

  1. Goddard says during her tenure she has seen “RDR rejecters” reluctantly come around to the idea of improving the profession, and has also seen what she calls “complete converts”.
    What she really means is they had no choice.

  2. One of the main objectives under RDR was abolishing commission payments so that there would never be any product bias ever again and therefore no misselling and we would live happily ever after. However the fact that some companies are offering to facilitate adviser charging whilst others are not will lead I believe to far greater product bias than we saw before. Also the way that product charging is being facilitated varies enormously between frims. You only need to listen to some of the backdoor antics being put forward by Business Development Managers from certain companies to see what a potential for abuse that there will be and also potential misselling. We seem to have gone through a lot ot pain and agony for no appreciable benefit for the client but at least I have another exan certificate on my office wall!!!

  3. ….“The worst possible outcome is that you create another kind of bias which does not benefit the consumer. A simple example is company A facilitating adviser charging on an investment bond, and company B doing it in a different way. Will that drive the product selection, and will that be based on what benefits the adviser’s business rather than what is right for the client?”
    Faye, you are a bit late with this statement -like 2 years too late. This has been a concern for a long time. If client is prepared to pay a direct fee then it is not an issue. If, however the client doesnt want to pay a fee then of course it will create bias. The adviser is NOT going to recommend a provider who does not facilitate AC. So much for the wonderful FSA idealogical RDR removing bias.

  4. Breathtaking, but not in a good way. She had the chance to really have a great imput into the RDR process.
    Like all the leaders in our industry however she did not stand up for her membership and now has lost a huge proportion of them.
    Well played Ms. Goddard, I wish you a very happy retirement with your Spaniel.

  5. Paul,

    I would like to take this opportunity to point out that both the PFS Board (to whom Fay is accountable) and the PFS membership overwhelmingly supported the professionalism elements of the RDR.

    Given this I believe it’s rather harsh to suggest that Fay was not acting in the interests of PFS members.

    For the record the PFS currently has just short of 34,000 members – significantly more than when Fay began her tenure.

    David Ross
    CII

  6. @David Ross & FG

    One word;

    GRANDFATHERING

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