In 2012 an album called “Hope” topped the Australian classical music charts. It sold so well that it briefly also appeared on the Aria Top 10 album chart, outsold Madonna, and featured a track performed by Olivia Newton-John.
In 2014 there’s another album out, called “Moon Under Water” – named for a George Orwell essay in which the author imagines a perfect place to meet: a pub. Both albums were produced or co-produced by, and feature as a performer, Andrew Hagger, probably better known to financial planners as the group executive of NAB Wealth and chief executive officer of MLC.
“I did produce an album a year and a half ago, called “Hope”, on ABC Music, which was number one on the charts for several weeks,” Hagger says.
“It was number one on the classical chart but it was at the time a Top 10 Australian album across all genres.”
You can occasionally still catch Hagger performing around town, but it’s a different kind of performance that he is focusing on today as head of one of the country’s largest wealth management businesses.
After just over 12 months in the role, having replaced long-time MLC CEO and NAB Wealth group executive Steve Tucker, Hagger says it’s “an important and fascinating time for the industry right now”.
“We’re seeing one of the biggest [changes] of regulation that’s now flowing through to the customer experience,” he says.
“We’re seeing as time goes by a shift in demographics; still this very large $1 trillion retirement [savings] gap; and also underinsurance in Australia. So there’s much to play for.
“And we see the things that technology can do today that just weren’t possible 10, 20, 30 years ago. You wrap all that up in the fact that Australians are much more engaged with their superannuation today than, again, they were five or 10 years ago.
“So there’s a lot of dynamics at play, a lot of reasons for us all to be true to our purpose and play our part in helping Australians have confidence in their financial futures.”
The NAB group’s salaried and aligned advisers as at September 2013 numbered 1,810 including those operating as authorised representatives of Garvan, MLCFP, Apogee, Godfrey Pembroke, Meritum and JBWere.
Every adviser is different
“We organise our business in a way that appreciates that every adviser is different, have different levels of relationship with us,” he says.
Hagger says that for all financial planners, shifts currently taking place in the industry are overwhelmingly positive.
“Two biggest shifts that we see are both in our view very pro-adviser trends. For us the first shift is that we are organising ourselves more and more to help the integration of banking and wealth, and that of itself is looking to reach many bank customers who contribute to that $1 trillion retirement gap opportunity.
“Many of the opportunities that arise in turn lead to an adviser conversation around specific advice, and that’s good for our adviser network. We’re very pro-adviser in our stance.
“Secondly, in terms of the shift in digitisation, there are some aspects of the advisory process that are becoming much easier through technology and also there’s far more usage across the industry of data and insights that come from that data.
“That of itself can help advisers to be more equipped to have quality conversations with their client base, based on that data.”
Like fish and chips
Hagger says the fact that banks and their wealth divisions are coming closer together is very much a positive for planners.
“The way we describe it internally, a phrase that has stuck, is that banking and wealth is a bit like fish and chips. The two go together naturally,” he says.
He says that often leads to “specific advice opportunities, and to us the extent of the opportunity is extremely large, and or us to have an adviser network of the quality positions us well to respond to those needs.”
Hagger declines to be drawn too far into the recent debate about the reintroduction of commissions for general advice, and the role the banks played in lobbying for that turnaround.
“Where we come at FoFA from is, firstly, for many years we made clear our position on trust and transparency within the industry, and its incentives needing to be in the right areas and not in the wrong areas and so forth, and I think we’ve been very clear about that, and continue to be. It continues to be a core part of our character.
“I think the point has been well made that there are specific rules in place around best interests; I think that the character of MLC, understood in the industry, [means] we do not have the desire to reintroduce commissions for advisers via the general advice carve-out.
“We come at this with a track record of character, and also a strong desire for this $1 trillion gap to be closed. From that point on, it becomes a very granular discussion; it’s a discussion that is an important one, and it’s terrific that it’s got a lot of engagement from the various stakeholders. It will be clearly discussed in Parliament at the right time, and we’ll continue to play our role both in terms of the character we bring to it and the desire to see that $1 trillion gap closed.”
Entirely consistent
Hagger says MLC and NAB continue to be “entirely consistent with our character, and also very mindful that through the way definitions work we need to make sure that when consumers want to hear more about wealth matters, we create a safe and clearly defined environment for that to occur”.
“We have a very pro-adviser approach and we want to bring to customers, ultimately, the specific advice that they seek and that is appropriate for them, and that occurs in their best interest,” he says.
“That’s our guiding light though all of this. There are twists and turns on definitions. There’s been QC advice on various aspects. This is a very granular situation, so for anyone who is not closely involved in the toing and froing of those conversations, I think those two key points I am making – about our character, and our desire to close the retirement gap – are the guiding light that’s working for us.”
