The noise surrounding the RDR remains at full volume, although no-one will know what the final rules will demand of advisers until next year.
Openwork is no different, of course, but with the regulator unequivocal about the direction in which it wants the industry to head – particularly in terms of its move to Customer Outcomes - we have decided to take the initiative and act now.
Last week we launched what we call the Customer Benefit Programme, a significant project which will embed in our process and systems a more outcomes-based approach to advice.
The sheer scale of the project is, to say the least, challenging – by the time it has completed our 1200 pensions and investment advisers will have each undergone a comprehensive training and assessment programme to familiarise them with the new framework.
But I would suggest we are unique in having the resource and capability, as an exclusively AR network, to implement these changes now and in a way that ensures all Openwork representatives give advice in a manner consistent with regulatory objectives.
What does this mean for our advisers in practice? First and foremost the programme will usher in a less proceduralised approach to the advice process. For many firms across the sector compliance has, to a certain extent, been something of a box-ticking exercise. Simply put, our new process places the end result for the client at the heart of every action. Advisers will be afforded more flexibility in their judgements and they will have access to better systems to enable them to make the best possible decisions for customers. Taken together, this will enhance the quality of advice already offered by our advisers.
Will the transition to the new framework be easy? No change on this scale is ever straightforward, and clearly it will be easier for those firms already operating in a broadly similar fashion than those who are not. We will of course seek to assist the latter as much as possible and advisers will be afforded the opportunity to re-sit the assessment should they fail. Other options will also be available to these advisers, but we must be clear that there is a standard to be met and that it represents a fundamental part of our drive to be the leading adviser services business in the UK post-RDR.
This approach, in my view, is important in more ways than one. Having a well skilled and well supported network of advisers is both desirable and necessary, but it also has broader ramifications in terms of recruitment. We know the RDR will mean advisers will fall into one of a handful of categories, and that it will be much harder for advisers to remain, or become, an IFA. That means the ‘restricted’ adviser category could easily surpass the others in terms of size as advisers search for the home best suited to their established methods of working.
As a multi-tie Openwork fits neatly in that ‘restricted’ space, but it is important we do not automatically assume we will be the chief beneficiaries of the RDR. There is little doubt other networks will adjust their propositions accordingly to facilitate their move into this area, as they seek to achieve or retain the scale that will be so important in the coming years.
For Openwork, scale is as vital as it is for any other adviser services firm - but not at any cost. It is futile to attempt to gain scale by accepting just any adviser who wants to join. We want to attract progressive, professional advisers: those for whom the prospect of joining a network with high standards and a rigorous training programme appeals - not repels. The advice landscape is changing, and we must ensure we are at the forefront of that change – to the benefit of our advisers and, of course, their clients.
Caring for children and elderly relatives
Similar to June 2007
Square Mile’s series of informal interviews
Fine reduced to £60,000
Two roles created