Better business practices means better business
TOWER’s Compliance Roadshow took the issue of compliance to advisers around New Zealand in early November.
Monday, December 16th 2002, 12:00PM
TOWER’s Compliance Roadshow took the issue of compliance to advisers around New Zealand in early November.
“It was without doubt one of TOWER’s most popular roadshows,” says Peter Conroy, TOWER’s National Manger, Distribution Development. “I have to say I’ve never seen so much positive feedback from advisers from an event like this, so we obviously hit the nail on the head.”
Mr Conroy says that compliance is a key issue for all advisers and planners. “I think there is increasing pressure on organisations like the Securities Commission in New Zealand to implement tougher compliance regulations. The public is very wary now and getting more savvy when it comes to their expectations around financial advisers.”
In her speech at the Wellington roadshow, Securities Commission chairman Jane Diplock said that she applauded the attendees’ enthusiasm “for becoming more knowledgeable about the law relating to investment advice”.
Ms Diplock also stressed the fact that any legislation only set the minimum standards for the industry, and recommended that advisers should “look beyond the minimum standard of compliance to the broader concept of best practice”.
She said she saw best practice from advisers as being a key contributer to the integrity of the market as a whole.
Mr Conroy agrees: “A tougher regulatory environment will mean that advisers and planners will need to raise their awareness and embrace compliance as part of the total process of giving advice. It’s not something they can just tack on the end of the whole process, it has to be integrated fully.”
Mr Conroy admits that this has meant a fundamental change in business practice for some advisers, but that overall it has resulted in positive consequences for the industry as a whole. Australian experience certainly bears this out.
“There has certainly been a great deal of change over there, which has meant hard work for some businesses, but what we are beginning to see is a shift in public attitude towards the industry. More people are seeking advice than ever before, and I believe we can attribute some of that change in attitude to the higher level of compliance brought into the industry,” says Mr Conroy. “It’s simple – better business practices means better business.”
Mr Conroy also points out that there are many levels of compliance, but that putting best practice into practice doesn’t necessarily have to be time-consuming or tedious. “There are lots of options open to advisers to increase the level of compliance in their business. Even something as simple as keeping good notes from a meeting or a phone call and putting those into a client’s file can make a big difference.”
TOWER brought three guest speakers from Australia to New Zealand for the Compliance Roadshow: Tim Nethercote and Grant Holley, solicitors from Melbourne, as well as a financial planner from Newcastle in New South Wales with almost 30 years’ experience.
Tim and Grant are principals of the Melbourne-based commercial law firm Holley Nethercote. They also specialise in the area of working with both advisers and financial institutions on compliance, and have set up a business called Compact – Compliance & Corporate Training, which works with advisers and helps them with compliance and best practice, of which training is an integral component.
The financial planner told his story about being taken to court by a client to the tune of some $5 million. Mr Conroy says that it was his very personal story that helped make the roadshow such a success.
“This was a man who has obviously been hugely affected by what happened to him – both professionally and personally. He is an excellent example of an adviser doing everything right in terms of compliance and best practice. Even though he had to go through a very arduous and drawn-out process, he was commended by his defence counsel for the good records that he kept, which provided them with a very winnable case.”
Mr Conroy says that TOWER will keep pushing the issue of compliance and best practice to advisers, both here and across the Tasman.
“We need to do what we can to ensure these issues stay foremost in advisers’ minds. Raising the bar will have positive and powerful implications across the industry. There’s a lot to think about and a lot of changes to make, but TOWER will be helping advisers as much as possible with that process in the coming months. Making a client record sheet [see diagram] available to advisers is only the beginning.
“Advisers are a fundamental link between our company and our customers, so it’s important that we support and encourage best practice from them. It’s not enough to sit back and just wait for it to happen,” Mr Conroy says.
For more information about compliance and best practice issues, contact your TOWER Business Development Manager on 0800 4 TOWER (0800 486 937).
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