The Financial Services Union has experienced a bump in engagement from advisers and brokers disaffected with their industry association representation during and after the Hayne royal commission, according to FSU national secretary Julia Angrisano.
“I would say that in the last 12 months and in the last six months in particular we’ve certainly seen a spike in approaches from planners and mortgage brokers,” she says.
“What became really apparent to me during the [royal commission] process is that the associations have really let down their planners. There were too many internal conflicts about who they were going to represent and it just became a bit messy,” Angrisano continues.
The FSU competes with industry associations such as the Financial Planning Association and the Association of Financial Advisers for the membership and attendant fees of planners. The union’s scope is larger, incorporating the broader financial services industry, while the associations are specialised financial advice representative groups that also run extensive education programs for advisers.
There will always be different opinions amongst members of associations, said Dante De Gori, the FPA’s chief executive.
“However, there is a resounding alignment in terms of the direction the profession is heading,” De Gori added, in response to the FSU comments.
Phil Anderson, the AFA’s general manager of policy and professionalism, said they were aware the FSU was actively “recruiting”.
“We very much understand that advisers are very anxious right now with all the challenges they’re facing,” Anderson stated. “We’re in very difficult times and there’s a reason for them to be out there listening to the options that are available.”
Anderson noted, however, that the FSU “doesn’t serve the same purpose as a professional association”.
The FSU currently has 30,000 members, while the FPA has approximately 14,000 members and the AFA has around 4300 members.
Angrisano says it is difficult to pin down exactly how many of their members are financial planners because members aren’t obliged to divulge their role.
“If you join advice in a bank, for example, you don’t necessarily tell us that you’re an adviser within MLC or whatever,” she says. “It’s hard for us to give a number.”
During the royal commission AFA chief executive Phil Kewin and FPA chief executive Dante De Gori were questioned on the role of the associations. While the FPA was pilloried for their handling of the notorious Sam Henderson case, Kewin was forced into an uncomfortable admission that there was “tension” for the association between the role of representative and disciplinarian.
According to Angrisano, this tension is starting to affect the membership base.
“There’s internal conflicts about the direction they want to go and what they want to push for, and that tension is starting to filter through at a membership level,” she states.
The FSU’s “traditional heartland” on the wealth management side has been in the big four banks and AMP, Angrisano says, but they are getting more enquiries recently from advisers in boutique and mid-sized firms as well.
“My sense when I talk to planners is that they feel really confident around the advocacy, representation and the necessary lobbying of government.”
Angrisano acknowledges that the FSU has some work to do in improving their value proposition in the financial advice industry, where the associations enjoy the benefits of incumbency and specialist knowledge. To that end she says the union is committed to working harder to understand the needs of advisers.
“We decided in February – post the royal commission – that it would be important for us to really invest some resources in the financial advice and broker space,” she says.