Roddy Kohn, managing director of Kohn Cougar and former PIA board member, says experience of the industry is an invaluable resource which intermediaries must learn to utilise
Although managing director Roddy Kohn is among the most quoted figures in the UK adviser community, Bristol-based firm Kohn Cougar remains a relatively small operation with just four registered individuals.
Kohn says the firm aims to give a personal service and is certainly not trying to be a mass marketer, as it continues to look after most of the clients it began with 14 years ago, rarely losing business.
As most of the firm's new business coming from referrals from existing contacts, Kohn says he prefers not to make use of professional links with other bodies, as such arrangements often involve commission sharing and he does not believe in double charging clients.
With most of its clients having upwards of £50,000 to invest, the firm maintains a balanced view on the fees versus commission debate, leaving it to individual clients as to how they pay for the advice they receive. However, Kohn stresses that he does expect to be paid for his services, as emphasised by an underlying fee structure at the firm. A client will not meet with an adviser before they have paid an initial fee of £195 plus VAT.
'However Kohn Cougar is eventually remunerated for its services, the most important thing is that we talk straight and look our clients in the eye,' he adds.
Kohn is similarly pragmatic in the face of industry watchdog Ron Sandler's recent calls for financial advice to be split into generic, core and full definitions, although Kohn Cougar itself is known as an investment and retirement planning adviser. 'In reality, we have 20 years' experience in investment and retirement planning and similar holdings to many of my clients, so we do focus on those specific areas,' he says. 'In my view, advisers should certainly focus on, and exploit, their strongest areas and possibly refer to other specialist sources if they feel it necessary.'
Despite the relatively specific nature of Kohn Cougar as an adviser, Kohn says the firm's back office system, which incorporates fact find data on an individual's pension, life insurance, mortgage and so on, allows it to accommodate the holistic position of its clients.
This software also has a portfolio-planning element that allows the advisers to set specific growth goals on individual clients' funds, and Kohn acknowledges how important it is to be sensitive to a client's overall financial circumstances when doing this.
Although the tenth most quoted adviser in the UK press, Kohn warns against the assumption that a healthy media presence will automatically lead to a stream of new business. As a former PIA board member and ex-Chairman of the National Federation of IFAs, Kohn has always been a well-known industry commentator. However, he is unsure whether employing a PR agency to maintain a brand proposition is a particularly valid enterprise for intermediaries.
'In my experience, a media presence does not necessarily generate a huge amount of leads or client enquiries,' he says. 'It does perhaps serve to reassure existing clients, but is that sufficient reward for hiring a PR agency and the other work involved in pushing a brand name?'
With the regulation system changing post-N2, compliance is a massive issue for advisers at present, and Kohn says he prefers to see the current state of flux as an opportunity to change the system rather than as an added regulatory burden.
He adds: 'Now the 1% is in place, the regulator has a responsibility to make this charging structure justifiable by providing an environment in which advisers can operate cost effectively. It is critical to use the current situation to revisit the existing infrastructure and processes and identify where changes could be made.'
While there are obvious areas of the adviser world that demand consumer protection - cash handling and discretionary broking for example, Kohn believes the phenomenal range of investment contracts now available have much reduced the chance of people being ripped off or mis-sold.
He points to innovations like x-shares and other changes in the underlying commission and fee structure that allow investors to unwind positions at a low cost as evidence of how the system already offers considerable protection to the consumer.
Going forward, Kohn hopes the regulatory system will move further towards desk-based monitoring. He says Kohn Cougar is an ISDN-linked office and would be prepared to link its compliance system to that of the FSA so all transactions would be entirely transparent.
One major change to the intermediary landscape post-N2 is the phasing out of CPDs, and this issue of training and development is particularly close to Kohn's heart as an industry commentator. He says he has been fairly supportive of the FSA's 'culture of enlightenment' in this area and believes the regulator's goal of simplifying the intermediary qualification system is absolutely imperative.
His own preferred method of improving the education system for advisers is to formalise the links between the industry and universities.
'The consumer has a right to understand who is qualified and who is not,' he says. 'It is completely unacceptable to retain archaic and confusing qualifications because they have become the norm. The abolition of CPDs is certainly a move in the right direction, helping to weed out bad practices and poor salesmanship and starting to clarify the standards that professional advisers will be expected to meet.'
Kohn Cougar's Roddy Kohn
1983-85: Started as financial adviser at Trevor Price & Partners in Birmingham
1985-86: Broker consultant at Irish Life
1986-87: Broker consultant at Abbey Life
1987: Left Abbey Life to set up Kohn Cougar
Developed by industry-wide group
Joined in 2002
'Educate clients' children'
Raised £15m earlier this week
From 8pm Friday 19 October