Yet again our latest regulatory invoice is significantly higher than the last. It is tempting to complain loudly but, as a financial adviser, I have learned our public image is still less than ideal and complaining about regulation is unlikely to elicit much sympathy.
Of course, our own clients regard us highly but the public generally is less trusting. The poor image is a result of genuine issues, such as the many misselling scandals, but also a continued and often-unfair bad press.
To take the misselling part first: there is no getting round the fact the scandals were, well, scandalous. Many were victims. However, rather than these being a failure of regulation, I prefer to see them as evidence of the success of the regulation we have. Think for a minute about what has happened.
Some advisers caught up in the scandals were unskilful; some lacked judgement. Even worse were those who deliberately took advantage. However, due to regulation, the bad advice was eventually identified, losses quantified, clients compensated and lessons generally learned.
Overall, regulation is doing its job, especially with the introduction of the RDR. Of course, in an ideal world there would be more identifying of problems before they arise but in the real world, dealing with complex financial matters, this is not always possible.
Onto the second point, then: is the continued bad press justified? It is a sad fact bad news sells (so much so that a fellow media-friendly IFA recently told me a genuine good news protection policy story of his had been declined by several papers precisely because it painted financial services in a good light).
This continued bad press – bias, even – coupled with an almost non-existent financial advisers’ lobby and weak governance, can only result in ever-greater regulation. The kind of regulation that might extend far beyond what is needed for the protection of clients and deep into the “business prevention” territory of overzealous compliance.
And as we know, the cost of this would not just come out of fat cat profits: ever-increasing costs could drive good advisers out of business, put others off becoming one of us and ultimately increase costs to clients by way of higher advice fees.
So what can be done? I would like to take this opportunity to appeal to my peers to join me and other media-friendly advisers in really making an effort to engage with the media (trade, local and national) to help turn the tide of bad news stories.
We all have genuine good news stories to tell and it really is not difficult to do. I discovered some years ago press releases are not just the preserve of large, well-connected companies with press offices: anyone can email the media outlets with their stories. Most journalists are only too pleased to receive copy, so do not be shy.
Let’s all make an effort, where we can, to help turn the tide of perceptions. Otherwise, should we really complain when the ever-increasing regulation bills hit our desks?
Scott Gallacher is director of Rowley Turton