Adviser Ratings is expanding its reach into the financial planning market with the launch today of a licensee portal, to give 1300 Australian financial services licence (AFSL) holders an overview of, and tools to manage, their advice networks.

The portal provides licensees with insights into consumers’ ratings of advisers across their advice networks, as well as showing details of individual clients’ ratings of individual advisers.

The expansion of the service will also give consumers deeper insights into which licensees authorise which advisers – and for the first time give even the lowest-profile licensee entities a highly public and visible profile.

“All 1300 licensees, irrespective of who you are, irrespective of whether you’ve got a public brand, will now be visible to the public,” says Angus Woods (pictured), managing director of Adviser Ratings.

“Every licensee will have a public profile. They will have all their advisers under each licensee, and then what the licensee then needs to do, as part of their public profile, is work through how do we look after our clients beyond the adviser’s relationship with the client – how do we make sure our advisers are compliant?”

The Adviser Ratings licensee portal enables licensees to spot both good and poor advice and advisers, potentially before issues escalate into an issue with an external complaints resolution scheme, such as the Financial Ombudsman Service (FOS), or with the Australian Securities and Investments Commission (ASIC).

“By tracking informal complaints before they become formal complaints and go out to other media, to help mitigate brand damage and brand reputation,” he says.

“You can spot something as it’s developing, as opposed to being two years down the track and there’s an issue.”

Flag emerging issues

Woods says Adviser Ratings is feeding back to ASIC some of the intelligence it is gathering about individual advisers and licensees. Adviser Ratings will flag emerging issues with the regulator, enabling licensees to “get on the front foot with ASIC, so it becomes a bit of a closed issue for them, before it becomes a bomb under their brand.”

Woods says the portal produces a range of benchmarking reports on how a licensee’s advisers are performing, compared to advisers authorised by other licensees. Part of the benchmarking covers consumer feedback.

“There’s two elements of the consumer feedback information that they get in real time,” Woods says.

“It’s how their advisers have helped their clients – so it’s their experience and their skill sets – whether they are more SMSF-focused, whether they are more budgeting-focused, and those sorts of things. It’s ‘what is my actual niche in the marketplace?’ as opposed to just being an adviser.

“And there’s also the qualitative metrics, in terms of how good a bloke is he, how often does he contact me, is he living up to his end of the bargain in terms of what I signed up to in my Statement of Advice originally?

“That visibility is suddenly what the licensee gets – and they get it by adviser and then by the individual consumer for each adviser.”

Targeted advice and advisers

Woods says licensees get a picture of their advisers’ performance, in the eyes of consumers, which can produce further benefits for the AFSL holder.

“You can then work out, where are holes in my advice network that I need to fill?” he says.

“We help facilitate that by offering advertisements or targeted job solutions for your advice network, specifically targeting the types of advisers that you want. That section will be rolled out in two weeks’ time, and they can then go in there and say I’ve got a need at the moment to bolster our SMSF side of the business; I know these advisers are SMSF-qualified or SMSF-centric, based on the feedback from consumers; I also need it in areas lie the eastern suburbs; so I am going to target advisers in the eastern suburbs and to mitigate any training or compliance costs I want to just target CFPs or those that are degree-qualified, that have SMSF experience.

“That will go through the adviser’s dashboard – [a licensee] is looking for these types of advisers, in the eastern suburbs; you qualify as that; why don’t you come and look at what the proposition is under that licensee?”

Rewards for a job well done

Woods says tracking of consumer feedback on advisers may ultimately reward advisers and advice businesses that are doing a good job.

“We’ve spoken with several [professional indemnity] insurance firms about how they can better target and decrease premiums across selected advisers –those that are doing good work,” he says.

“Obviously there’s the handful of advisers that push up the premiums, and there’s those that are the standouts that should be given lower premiums.”

Woods says there has been “a handful of licensees that have helped mould” the licensee portal and the tool it offers.

“And now we’re ready to unveil what they’ve helped mould,” he says.

“This has been in the pipeline for 18 months. We’ve been building the process on feedback from the advice community, especially the licensees, around risks that they do not foresee within their businesses. They wanted to have visibility on what consumers are saying about them.”

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Simon Hoyle is head of market insight for CoreData Research.