If the Financial Planning Association and the Association of Financial Advisers are to merge they will have to work through many divisive issues.
Are the various interest groups that make up the Australian financial planning industry capable of finding enough common ground to form a single, overarching industry organisation?
That, in essence, was the question posed last week by dealer group Matrix when it canvassed a merger of the Financial Planning Association (FPA) and the Association of Financial Advisers (AFA).
Interestingly, neither the FPA nor the AFA are dismissing the concept out of hand, yet it is a concept that will give the soon-to-depart chief executive of the FPA, Jo-Anne Bloch, cause for a wry smile given the clear-cut differences in policy that have emerged between the two organisations.
After all, it was the FPA’s timetable for moving away from commissions-based remuneration that last year generated a minor membership migration to an AFA that seemed to quite deliberately and publicly eschew such a concept.
In short, the policy, philosophical and cultural differences between the FPA and the AFA have always seemed to run deep — something ultimately exemplified by the underlying make-up of their memberships.
While there has been much common ground found between the two organisations, the success and membership growth enjoyed by the AFA has owed a great deal to its ability to differentiate itself from the larger FPA.
Notwithstanding these obvious hurdles, the Matrix proposal makes good sense for an industry that boasts less than 20,000 participants but already has two major organisations — the FPA and the AFA — seeking to represent its interests alongside other, more sectional groups.
In terms of giving the financial planning industry a single, more focused voice, a great deal stands to be achieved by merging the AFA and the FPA, but such an outcome can only be achieved if the vested interests on both sides work through the issues.
Merging Westpac with St George took nearly two years to achieve on the back of mutually agreed commercial and financial objectives. Successfully merging the AFA and the FPA may take a good deal longer and will require many people to put their egos and agendas on hold.
