There is strength in diversity, but leading a self-described “bunch of rugged individualists” has its challenges, too.
Dacian Moses, recently elected president of the Boutique Financial Planning Principals Group (BFPPG), should know this: as a director of financial planning firm Waterfall Way, Moses is one of the very individualists the BFPPG represents. But despite the avowed individualism of the association’s members, the issues that unite the boutique sector of the financial planning community are, as in many things, greater than the things that divide it.
In the coming 12 months the industry can expect to hear more from Moses about what the BFPPG’s members think on a range of subjects. Foremost among those is the issue of licensee ownership.
“We’re really keen for disclosure of the ultimate ownership of the licensee,” Moses says.
“The register [of advisers] is part of that, but it’s only a small part of that. We try not to be anti-institution, but we’re very keen for consumers to be able to make informed choices about whether they get institutional advice or independent advice.
“Our other big move forward this year is we will be more active in social media. I don’t know of another way for a small organisation to have a big voice.”
Increase in numbers
Moses has been elected for a term of 12 months and he says that a focus for the association during that period will be to increase its numbers from the current 80 to 90 mark to more than 100.
It will also begin to offer mentoring for financial planning businesses seeking to obtain their own financial services licence.
“We want to get larger, but not outrageously larger,” Moses says.
“We want quality boutique firms to join.
“We may also find that there’s some financial planners who are thinking about getting their own licence. There’s a process that’s required by ASIC, and my personal experience was that the process came from the right place – you are forced to consider a bunch of really good things – but getting that down on paper in a usable format, so it’s useful business tool…ASIC can’t help you. They can only tell you when you’re wrong.
“We’re looking at allocating mentors now. A new member who comes in as an associate – someone who doesn’t have their own licence but is looking to do so – we can team them up with someone who is more experienced.
“Even if you buy the compliance work in…you’re still going to have these questions about…what does this all mean on a practical, day-to-day basis?”
Defining boutique
For BFPPG’s purposes, a boutique is defined as a financial planning business that holds its own Australian financial services licence (AFSL), and has 20 or fewer authorised representatives. The association has about 70 members.
Membership requires that the planning business is independent – as defined by the dictionary, rather than by the Corporations Act – and that it be independently owned, a term it equates with “non-aligned”.
The BGPPG constitution contains a handy definition of what “non-aligned” means: “Majority owned by financial planning practitioners, employees of the business or their associated entities”.
Or, in other words, “not majority owned or otherwise controlled by any bank, life office or fund manager”.
Objectives
The objectives of the BFPPG are to represent the interests of boutique firms to the Financial Planning Association of Australia (FPA) and to regulators and government; to foster friendship and support between members; to share information and ideas between members; and to harness the power of the collective to achieve cost efficiency in buying products and services – but without compromising member independence.
Moses says that what sets a BFPPG member apart from others financial planning firms is the ownership of the AFSL.
“Our members are professional advisers running a practice, but they are also licensees,” he says.
“That brings a range of challenges. If you are running an AFSL and you’re not an institution, you have limited resources.”
