The New Zealand Financial Advisers Association (FAA), Institute of Financial Advisers (IFA) and Professional Advisers Association (PAA) have each given the green light for the establishment of the new adviser association called ‘Financial Advice New Zealand.’
Each association held a special general meeting last fortnight for members to vote on the formation of the new body.
In each case, the vote was unanimously in favour of the new association.
The constitution of the new association will now be ratified by the boards of those organisations and by the establishment board of Financial Advice New Zealand.
Once this is complete, the new body will be incorporated.
Leap of Faith
“We had to get to the point where we take a leap of faith, push the boat out and let it float on its own, and we are at that point now,” IFA president Michael Dowling said.
He said there was now a mandate for it to act as a separate entity and work would begin on arranging funding for it.
Each organisation would have to go through its own process to determine whether they would close, he said.
“It would be ideal if Financial Advice New Zealand emerged as the strong voice for the industry. We cannot say how that process works for every organisation,” he added.
Mr Dowling said the development of the new association has been in the making for more than three years.
Time to govern
PAA President Bruce Cortesi said that it was time for the Financial Advice New Zealand establishment board to take hold of the reins.
Over the past four weeks, an Appointments Committee has been working through more than 40 applications for positions on that board, which will be responsible for getting Financial Advice New Zealand operating.
This will include developing the operational infrastructure and building the framework for the new body to deliver on its objectives in advocacy, standards and promotion.
The board will remain in place until the first AGM.
FAA General Manager David Yates said that his Association was pleased to have been invited to be part of the process.
“We are very excited about the possibility of Financial Advice New Zealand representing the industry. The thing that has encouraged me more than anything else is the obvious genuine desire to make this work for the whole industry,” he said.
Mr Cortesi said that the insights the group had picked up about the industry as it worked through the development phase had been beneficial.
“As one of our last actions as a working group, we would like to again take the opportunity to thank everyone who has participated in bringing Financial Advice New Zealand to life. Your involvement has been crucial in defining how our new association can best support advisers, advice and the New Zealand public,” he said.
Financial Advertisers have learnt the importance of being independent along with the responsibility it imposes towards the industry, abiding by the codes of conduct and setting high standards of governance within the business of an individual and other professions.
The Financial Markets Authority (FMA) has brought in the positive message that there will be minimum standards for entering the industry, and sending the message that the future belongs only to serious players. What FMA can do is ensure the cost of licensing stays reasonable. The cost of licensing should not become a deterrent for independent advisers to survive on their own.
Propensity to Save
Educating the masses on the importance of savings, and providing additional incentive if the investment decision is made through services of an qualified investment adviser are also sacred duties of financial advisers.
Financial advisers are professionals who bring the human face to the process of insurance, investment, mortgage and financial planning. They have the requisite knowledge and experience to simplify the complex process into an easy-to-understand solution, and they will be able to take the stress out of a client’s financial decision-making process.
It is a responsible job – get into it only if you want to make it a long-term career, as many lives will depend on the plans you write, and will expect you to be there to support them when the need arises.
Anand Srinivasan is Director, Brisk Insurance, a company that designs insurance plans specific to circumstances of people covering Life, Disability and Health Insurance advice. He was honoured with the ‘New Insurance Adviser of the Year’ Award at the Professional Advisers Association (PAA) Excellence Awards in Auckland on August 3, 2017. He was previously National Manager, Key Relationships, AIA New Zealand. The above article is partly based on a Q&A interview by Susan Edmunds published online www.goodreturns.co.nz. A related story, ‘Best advice on insurance comes from risk-free professional’ appears in this issue.