The $60 billion industry superannuation fund AustralianSuper produced about 10,000 statements of advice in 2012. The fund’s head of policy and public affairs, Louise du Pre-Alba, says it expects to produce about 20,000 SoAs this year.
Think about this. AustralianSuper alone has about two million members. What if this super fund puts its arms around two million people, gets advice to them (ranging from subsidised intra-fund advice right through to member-pays, fee-based holistic advice), does it relatively cheaply and efficiently, and establishes a strong advice relationship with them quite early on in their financial lifecycles?
If it could do this, AustralianSuper could effectively remove two million Australians from the pool of clients for other financial planners to compete for.
And what if the other big industry funds did the same thing?
Well guess what? That’s exactly what they are doing.
If you think that industry superannuation funds are not serious about financial planning then it’s way past time to think again. That boat has sailed.
And if you still think industry funds are anti-planner then, with the greatest of respect, you’re mad.
Compare the pair
The industry funds’ “compare the pair” advertising was always clear: they are not and never were anti-planner; they were purely and simply anti-commission. Those are two very different things. Their message was: don’t go for a fund that pays commission to financial planners.
It was never a message against seeking advice. But sections of the financial planning industry chose to interpret the advertising as a direct attack – which it never was. And by misinterpreting the message, they misunderstood the funds’ intentions.
Don’t worry about professionalism in industry fund land. On Monday this week there were about two hundred financial planners in a function room at the Melbourne Cricket Ground, all of them from not-for-profit super funds (read: industry funds), and the representation of CFPs in the room was at least as high as it is at most financial planning gatherings (except perhaps an FPA-only event).
The organiser of the Financial Advice In Super Symposium, Industry Fund Services, put together a strong program. As well as speakers from key industry funds – including AustralianSuper, UniSuper (480,000 members) and SunSuper (more than one million members) – the program included the chief executive of the FPA, Mark Rantall; the chair of consumer group Choice, Jenni Mack; ASIC Commissioner Peter Kell; Parliamentary Secretary to the Treasurer Bernie Ripoll; the Coalition Member for Bradfield, Paul Fletcher; the managing director of Strategic Consulting and Training, Jim Stackpool; and Mercer’s financial advice leader Jo-Anne Bloch.
That’s a line-up that would more often be found at a financial planning “industry” event; the fact that the ISN symposium spent so much of its time examining the transition to professionalism and the need for strong ethical and technical skills among financial planning practitioners should leave no one in doubt that the standard of planner in the industry fund space is probably better than average.
The enemy within
But another notable aspect of the event was the new-found respect that exists between Industry Super Network, led by David Whiteley, and the FPA.
Probably only a year ago, these organisations were more or less at each other’s throats – mortal enemies, essentially. But if the representation of CFPs in the room is any guide, then industry funds are actively pushing that professional designation, which obviously translates into membership of the FPA.
Rantall reiterated the FPA’s stance that it is employer-agnostic. If you’re a financial planner, and if you measure up, then you’re a potential FPA member, irrespective of where you work. Professionalism, after all, exists at an individual, not institutional, level.
Rantall was asked when there would be an industry fund financial planner on the FPA board. His answer was simple: as soon as such a planner nominates, and is elected. Expect that to happen sooner rather than later.
Industry funds have embraced financial planning in breathtaking fashion. They are pushing hard to make their financial planners measure up on technical competence and ethics – professionalism in other words – and they are developing innovative and compelling planning solutions for massive groups of people.
Industry funds are not the “enemy” because they’re anti-planner. If they’re the “enemy” at all, it’s for exactly the opposite reason.
Leave a Comment
You must be logged in to post a comment.