For most advisers, the hard yards are done – the exams are complete, the clients segmented, the future business strategy defined. A recent study by Defaqto showed that the thorniest issue for the majority of advisers remains the decision on independent versus restricted. It found that the number of advisers that are committed to independence has dipped from almost all to around two-thirds now.
Most are still waiting for further advice from the regulator, or are seeking clarification that they can
call themselves independent with an outsourced solution. In both cases, it is likely to require some level of regulatory experimentation, however uncomfortable that sounds, before the real solution is found.
The definition of the service proposition is also still troubling some advisers. This should be the DNA of
an adviser’s business, encompassing all it wants to be and do, and yet Defaqto found that many are still struggling with it. This suggests that for some there is still an identity crisis at the heart of their business. This is unsurprising, given the magnitude of the change advisers are being asked to make, but something that will ultimately need resolution.
Defaqto’s recommendations were based around processes and documentation. As a general rule, the FSA is more likely to be satisfied by an adviser’s business if it finds due care and consideration has been made in the decision-making and – most importantly – there is the documentation to prove it.
Our adviser this month, Lee Robertson of Investment Quorum, gives his thoughts on business transition. He believes that much of his success has come down to having a clear message and sticking with it – with clients, with the media and with staff.
Platforms remain the unresolved area of RDR, with no definitive guidance from the regulator yet. Defaqto found that many advisers are building up their platform solutions regardless. The group believes this is the best approach – advisers then have something to work with when they have further guidance.
This is the last Adviser Evolution until we are the other side of RDR. It is likely to be a busy festive season. We wish you all luck in your final preparations.