Concerns aired over Code Working Group

There is a risk that a lack of independent advisers on the working group developing their new code of conduct will cost New Zealand its opportunity to provide a sensible framework for advice, one adviser says.

Monday, July 10th 2017, 10:49AM

Mike Newton, of advice firm Newton Ross, told Good Returns TV it was scary that none of the nine people chosen to develop the new code were financial advisers.

He said while some of the group had strong industry knowledge, or product manufacture experience, whether they could develop a practical code that would work for advisers was another question.

“There’s no one on the committee who has ever really practised,” he said. “There’s no independent financial advice representative on the committee, they are all product manufacturers.

“It looks very much as if the institutions have captured that end of the market. We are very concerned.”

He said it was extraordinary that the group would have to set the competency and qualification levels for advisers without an adviser voice among them.

Newton said while the group could consult with practising advisers, and has said it would, it was hard for independent organisations to make the time to do so.

“We are a smaller organisation. How do we afford the time, energy and expertise to have a say? It’s a lot easier for the regulators to go to the big end of town because they can make their people more easily available.”

Newton said there should be two financial advisers added to the group, and at least one of them should be a certified financial planner. “It’s going to be driven by the manufacturers. I think that’s a poor outcome.”

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Tags: CFP Code Committee financial advisers Newton Ross regulation