One in five advisers considers the FSA's Review of Retail Distribution as a "threat" to the industry while one in four don't know the impact it will have, a survey reveals.
The Aegon IFA Insights study also shows that the majority of IFAs believe commission has a "vital role" to play in their business.
The Review, launched in June last year, was designed to address the root causes of problems in the retail investment market.
It is looking into measures to ensure IFA firms have sufficient capital backing, asking whether commission creates product or provider bias, and assessing the role of regulation in ensuring customers get a fair deal.
Aegon asked 100 IFAs their opinion on the review, with 55% saying they they view it as an opportunity for advisers to enhance their professional status and reputation.
However, 20% say it presented a threat to IFAs and their way of working, while the remainder, 25%, say they don't know what impact the review will have.
Graham Dumble, Aegon director of risk and regulation, says it was encouraging so many considered the Review as an opportunity, but expresses concern that so many are unsure about it.
"We believe it is critical that IFAs are fully engaged in the Review and contribute to the debate," he says.
"It is essential for the FSA to work closely with the IFA sector throughout."
The FSA is set to publish a discussion paper in the summer, setting out the analysis, initial conclusions, and recommendations of the Review.
The Aegon IFA Insights survey also revealed strong opinion on the future role of commission.
A total of 95% of advisers asked say commission has a vital role to play because many of their clients would not be willing to pay a fee for advice.
Three quarters of IFAs say commission-based remuneration is generally best for smaller savers, while fees are better for those with more to invest.
In addition, 72% of advisers would be better able to adapt to client needs if providers offered more transparent product pricing and flexible commission structures.
IFAs were split on whether they would consider moving to a fee-based structure but were put off because their business strategy is dependent on regular commission payments. 48% of advisers asked say this was the case.
Graham Dumble says: "The most interesting point is that as many as 48% have stated they would like to move to a fee-based structure.
"The FSA's Review should be looking at ways to help these IFAs achieve their goals."
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Scott Sinclair on 020 7034 2636 or email scott,[email protected]IFAonline
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