A large portion of the financial advice sector is struggling under mounting compliance and governance demands, prompting some to leave the industry. While the old way of doing business is becoming less and less profitable amid higher regulatory costs, some advice firms are taking advantage of the regulatory reforms to find better solutions for their business and gain a unique competitive advantage.
Ensuring that your advice business model is genuinely client-centric will become even more critical from 5 October 2021, when new Design and Distribution Obligations (DDO) comes into effect. This follows findings that complex product design and poor distribution practices have led to bad outcomes for consumers. Simply providing information does not always help clients make good financial decisions.
New consumer-centric financial product and distribution obligations from April 2021 offer astute financial advisers an opportunity to not only meet the requirements, but to gain an edge in achieving superior client outcomes and improve their business practices.
