Sales remains a dominant factor in financial planning recruitment, according to both recruitment experts and research undertaken by Money Management into the core criteria stated for many financial planning jobs.
Associate director for banking at Robert Walters, Sara Harrison, and senior regional director of Hays Banking, Jane McNeill (pictured), agreed it was typical for financial planning roles to involve an element of sales and be remunerated in that way. McNeill observed around 90 per cent of financial planner ads listing sales skills as a job requirement.
Money Management also looked at a number of financial planner job advertisements posted on the Money Management Jobs website and on the recruitment website SEEK, and found more than two-thirds of employers either looked for sales-driven financial planners or named sales abilities as one of the job requirements.
A large number of those who mentioned sales targets and bonus structures were banks and large dealer groups.
“By comparison, planners working in the boutiques generally have to be quite self-sufficient and possess the ability to develop referral networks and generate business for themselves,” according to McNeill, who said banks offered 50-60 per cent bonuses on top of planners’ base salaries.
“Often in boutiques, [bonuses] are even higher,” she said.
A recent survey conducted by the Financial Sector Union (FSU) found more than half of bank, insurance and financial services employees witnessed clients being steered towards products they may not have needed.
FSU secretary, Leon Carter, attributed this issue to the constant pressure on financial planners to sell products.
“Finance sector base salaries are not high; employees can’t afford to miss out on bonuses and performance pay – they are under unrelenting pressure to sell,” Carter said in response to the survey findings.
Although sales bonuses are a far cry from commission structures, Colonial First State general manager for advice Marianne Perkovic said there still needed to be a balance between sales and other key performance indicators advisers have.
“There obviously has to be a commercial outcome for most remuneration structures, but they’ve got to get the balance right,” Perkovic said.
“If [the advice has] got a good balance between risk, compliance and quality of advice, then I still think that’s fine, but if it’s still heavily skewed to sales then I think that would be a problem – which is working against what the [Future of Financial Advice reforms] are trying to achieve and that is quality of advice outcomes for clients,” she added.
According to Perkovic, banks have come a long way from five or six years ago when the advice was still heavily skewed towards sales, with the industry undergoing “good change” since then.
“So, I think people embracing the change is the only way we’re really going to get good client outcomes from FOFA,” Perkovic said.
