More support for individual advisers
Focusing on providing services to the adviser and not the licence holder will be the major focus for the Association of Financial Advisers (AFA) in 2006, president Michael Murphy says.
“We have got conflict in that the licensee owns the adviser and now the adviser has to find their own place in the sun,” he says.
“The issue then is, does an association provide services to the licensee or the adviser?”
Murphy says the AFA has been focused on the adviser rather than the dealer group.
He cites the example of its education program, which is affordable to the individual adviser, rather than other industry association schemes that have been designed for dealer groups.
“All we want to do is deliver integrated services to advisers to develop their businesses,” Murphy says.
“It is these divisions which are leading to the financial advice industry becoming so disgruntled — and that is a big problem.”
He says the difficulties are resulting in advisers shying away from client focus and devoting their attention to what is wrong with the industry.
“We have also become a more commodity-based industry. At an association level that is leading to organisations not being true to their label.”
The creation of standards that can only be validated by joining an association is taking away the previous desire to join a body because the adviser wanted to.
“The FPA [Financial Planning Association] claims it represents the adviser and it does not,” Murphy says.
“No one is joining voluntarily so, as a professional body, it is not representing the individual adviser’s interests.”
He sees this as a growing issue during the year as more advisers leave dealer groups to start their own businesses.
The focus on advisers in dealer groups also means the FPA is not helping the individual to gain experience in working for themselves, which was more prevalent in the past, according to Murphy.
“We need to focus more on being service based to the public.”
“This means we, as an association, have to provide services to the members that they want regardless of the type of business they are in.”
“And, of course, the AFA wants to see more people selling risk and making sure more of the public are covered by insurance of some form.”
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