Think like an institution, says Mercer
Mercer's push into the wealth management space is based on bringing institutional advice to retail clients, according to Mercer global head of wealth management Cara Williams.
"We have to figure out how to get people to react more like an institution. Our job is to arm financial advisers with that knowledge so they can get it across to their clients," Williams said.
Mercer head of wealth management Australia and New Zealand Brian Long said that Mercer was well positioned to help Australian planners transition to a fee-for-service environment by targeting high-net-wealth (HNW) clients.
"Everyone's after HNW clients, and they want highly discretionary portfolios, new investment options and dynamic asset allocation. If you don't have that then those HNW individuals will pay the [fee] to someone who has," Long said.
Mercer's experience working with private banks, along with its vast number of consultants on the ground, meant that it could provide dealer groups with the resources to cater to HNW clients, Long said.
Long added there was a tendency among dealer groups to insource since the global financial crisis, something that Mercer could help them achieve.
"[Dealer groups] are thinking: 'I outsourced before and I put people in funds that blew up, so I'm going to start insourcing this'. A lot of the bigger licensees are insourcing and developing their own portfolios in-house. We are uniquely positioned to give them access to the tools we use to construct institutional-quality portfolios," Long said.
Mercer could also help educate advisers to ensure that they complied with the 'fiduciary duty' obligations contained in the Future of Financial Advice reforms.
"It's just not enough to publish a rating and put it on a website. I think the lesson the industry has learned is to make sure that information is presented in a way that advisers can see. It has to be provided to them." Long said.
Williams added that Mercer was in a unique position in the Australia because it was in both the institutional and the retail wealth management spaces. She said it was relatively easy for Mercer to move from the institutional side across to the retail side because it already had the consultants and the research in place.
Recommended for you
Digital advice tools are on the rise, but licensees will need to ensure they still meet adviser obligations or potentially risk a class action if clients lose money from a rogue algorithm.
Shaw and Partners has merged with Sydney wealth manager Kennedy Partners Wealth, while Ord Minnett has hired a private wealth adviser from Morgan Stanley.
Australian investors are more confident than their APAC peers in reaching their financial goals and are targeting annual gains of more than 10 per cent, according to Fidelity International.
Zenith Investment Partners has lost its head of portfolio solutions Steven Tang after 17 years with the firm, the latest in a series of senior exits from the research house.
