Four out of five advisers believe that the Best Interests Duty (BID) has been necessary to raise standards across the industry, with the formal structure of the compliance regime improving their confidence in the quality of their advice.
Research by HUB24 also found that while advisers were generally confident of their understanding of the BID, 70 per cent of those surveyed said that they “definitely” or “may” need further training or information.
Association of Financial Advisers (AFA) chief executive, Phil Kewin, said that this showed that the BID was arguably the most important obligation for advisers. He called for more guidance on it for planners, as “ultimately an increased awareness of the BID … will result in improved outcomes for the consumers of financial advice”.
The research also looked at product selection, with the most significant consideration from planners being whether a product matches the client’s assessed risk tolerance, or whether the product was better or had more relevant features than others. Cost was also a factor.
When it came to platforms specifically, features also outranked cost in leading advisers’ choices. Interestingly, whether a platform could help add value for clients through active tac management of investment portfolios was either “extremely important” or “somewhat important” for 89 per cent of advisers.
The research was based on a survey of over 300 advisers on how they had implemented the BID in their business over the last five years and how it had affected the provision of advice to clients.