Advisers “part of the problem” with RI
Adviser resistance is contributing to the slow adoption of responsible investment (RI) strategies, according to Mercer’s member services and advice leader Jo-Anne Bloch.
Speaking at yesterday’s Responsible Investment Association Australasia (RIAA) conference, Bloch said clients needed to be educated about what was meant by the principles of RI, but it was resistance from advisers that was proving to be one of the great sticking points.
Bloch pointed to Financial Planning Association (FPA) research conducted in 2008 that showed RI strategies did not even rate a mention with the majority of advisers to illustrate the point that there needed to be an educational and cultural shift around RI, and that it did not necessarily involve compromising return for philosophical gains.
A lively debate emerged in the session, with some audience participants suggesting that there was a strong demand within the investment community for socially responsible products and that advisers who felt their clients would not be interested may not be asking the right questions.
“Advisers are part of the problem, and continue to be part of the problem. There’s a lot of work that we need to do from an advice point of view,” Bloch conceded.
“Giving advice, not just a flogging product point of view, from a remuneration point of view, from a disclosure and transparency point of view, never mind a know your client and have a proper discussion point of view,” she said.
“[But] there is a great diversity in the financial advice population. We’re all part of the journey and we’re all trying to push in the right direction.”
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