Advice research group Wealth Data is looking to introduce a new ratings system for advisers that can be used to measure the average quality of the adviser cohort at a particular dealer group.
It is the second adviser quality rating system to be trialled in recent weeks after research group ARData released its adviser “quality score” system in its Q3 Musical Chairs report, which found that the adviser exodus is improving the overall quality of advisers in the industry.
While ARdata’s system – which is still in developent – uses more qualitative measures including “director history and movement between licensees”, Wealth Data’s Star Ratings system takes a much simpler approach based on a handful of metrics.
The scoring system takes a ‘five stars’ approach. Advisers get two stars for having over 10 years experience and one star for between five and 10 years. They also get one star for passing the FASEA exam, one if they have at least one FASEA-approved qualification and one if they are a member of the Finanical Planning Association, Association of Financial Planning, SMSF Association or the Association of Independantly Owned Financial Professionals.
According to Wealth Data director Colin Williams the scores are then aggregated to give an indication of the advisers sitting under a particular licensee.
“Licensees are given an averaged score,” Williams says. “For example, if a licensee has 10 advisers and the total stars allocated for all advisers is 35, the score for the licensee would be 3.5.”
The Star Ratings system, which Williams says is being trialled with clients and not yet for the public, will be available on Wealth Data’s AFSL Listing online service.
“We have clients who currently use our AFSL and Adviser Lists for the purpose of accessing key people at licensees and practices,” Williams says. “The Star Ratings system is a simple and very effective method of fine tuning the ‘search’ for the right licensees and advisers’.”