ISI looks to become super-lobbyist

The ISI (Investment Savings and Insurance Association) looks set for a rebrand as its members try to create a financial industry organisation with more clout and lobbying power.

Tuesday, October 11th 2011, 5:00AM 3 Comments

by Niko Kloeten

After its annual meeting in Auckland yesterday, the ISI announced its members had voted for it to investigate a major change in focus that would see it renamed the Financial Services Council.

Discussions are underway with other financial services industry organisations to gauge support for the development of a pan financial sector group.

ISI members are looking to have a "highly influential industry organisation," according to ISI chief Peter Neilson: "They want an 800-pound gorilla."

If the proposal goes ahead the newly created group would look very different to the current ISI, with a focus on information and lobbying rather than industry self-regulation.

"There are severe limits in ISI trying to be an industry self-regulator when not every player belongs to the association," according to the ISI.

"And, as a voluntary organisation, any member who does not agree with any self-regulated proposal can simply leave to avoid them."

Neilson said with budgets tight, members were reviewing their spending to see whether they were getting value for money from membership of various groups.

He said there were too many small financial industry organisations and due to their lack of scale and resources they could be ignored when policy decisions were made.

"If you're the Agriculture Minister and you propose a new policy to the Prime Minister he will probably ask ‘what does Fonterra or Federated Farmers think of this?'" he said, adding there was no one group with that sort of power in financial services.

Neilson wouldn't say which organisations ISI had talked to but said the proposed super-group would include all parts of the financial services chain, including financial advisers.

However, he said it wouldn't try to represent the whole financial industry as there would be conflicts between different parts of it.

The foundation projects for the new group would focus on the insurance gap, on the future of long term savings and KiwiSaver and the future of regulation.

Neilson said the latter project would look at the best environment for regulation, and he said the current crop of financial regulations would likely be overhauled at some point.

"These things tend to move for ten years in a direction," he said.

"Sometimes when you do things you do have to respond to public opinion - not everything they have done is going to turn out as good as they expect."

Niko Kloeten can be contacted at niko@goodreturns.co.nz

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Comments from our readers

On 11 October 2011 at 9:57 am Mac said:

I wonder if the "800-pound gorilla" will be an advocate for the independent advisor community?

On 11 October 2011 at 11:15 am Amused said:

If experience had taught us anything it's that associations/organisations (no matter how big they are) never have significant sway over the powers that be when it comes to changing/influencing the direction a particular industry takes. Younger advisers coming through nowadays are most certainly looking at getting "value for money" when deciding on which memberships they sign up to (if any). As Mac states above they will need convincing that an "800-pound gorilla" will indeed be an advocate for them or else there is little point belonging in the first place.

On 11 October 2011 at 7:46 pm liam andersen said:

Mixed views on this. Firstly good on the ISI for (finally) recognising that their raison d'aitre has disappeared (ie a self regulator of insurers which has been replaced by the Reserve Bank).
Secondly good on the ISI for recognising the over-abundance of industry lobby groups (Insurance Council, INFINZ, CFA Society, Insurance Institute, HFA, ISI, IFA, , LBA, PAA, SIFA, Workplace Savings etc etc)
A new pan-industry group needs to emerge but maybe dinosaurs such as the ISI should simply wind up so the new group has less baggage rather than being a dinosaur tarnished with the past.