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Chief executive officer of Financial Advice New Zealand, Katrina Shanks told good returns that the process of getting her own financial adviser has “totally transformed my life”.
Before she began receiving financial advice, Shanks said that she thought that she was pretty competent, “I thought I didn't need it, but actually now that I've had advice, I realized just how invaluable it is and how it gives you a different lens of looking at things.”
Shanks went on to discuss the resilience of the financial advice sector under the dual pressures of covid and massive administration upheaval. “We had FSLA come through, which has set the environment which FAPs are going to operate in the future. And then on the top of that, you've got the disclosure requirements, you've got full licensing coming in. And then on top of that, we've had COFI come in for conduct and culture for product providers and companies and their reaction to what that looks like as well has changed the environment slightly. So, just as you think that the environment has settled, there's another change that's come into the environment.”
It is clear, Shanks says, that the financial advice sector has gone under much more change than other industries, “I can't think of any other sector which has gone through change so quickly over such a short period of time.”
Shanks believes that it is important in such times of change to make sure that robust systems are in place that protect both the adviser and the client. She spoke about the institution of the trusted adviser mark, “a mark that stands a little bit beyond the membership to say, I am committed to my profession”.
As well as this Shanks shared some thoughts on how to make the COFI conduct legislation clearer and fairer for advisers, “really it's about understanding the powers which have been given through regulation for licensing on renumeration. We think those powers are too wide and too far reaching. I can't think of any other industry where your renumeration is set in licensing conditions. So, we think that reach has been most probably a little bit too far. We've got concerns about FAPs having been excluded from this legislation, but individual advisors haven't. So, but we think that's just drafting error. So, we'd like to see that being fixed in the drafting and explicitly excluding financial advisors from that legislation, I think is really important as well.”
To read the full interview, click here.
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