Special Feature

Advisors’ Report Card 2015

Although advisors are continuing to see significant growth in their books of business, their practices are undergoing a seismic transformation as a result of CRM2. All the insight, the ratings and the candid comments from the September 2015 issue of Investment Executive.

Work remains to be done to improve firms' communication efforts with their advisors

By Tessie Sanci | September 2015

Although financial services firms come in all shapes and sizes and employ different business models, many companies need to do a better job of communicating with their financial advisors.

Specifically, the advisors surveyed for this year's Report Card series said their firms need to follow through on advisors' suggestions, listen to a broader group of advisors and provide information that keeps advisors up to date on the changes happening in the financial services sector.

The fact that firms need to do a better job in their communication efforts was evident in the "satisfaction gap" - the difference between the overall average performance rating and the overall average importance rating - in a "firm's effectiveness in keeping advisors informed" and "firm's receptiveness to advisor feedback" categories. The satisfaction gaps for these categories ranked among the 10 largest in the Report Card series. The receptiveness category was of particular concern for advisors, as the satisfaction gap was tied for third-largest.

One important reason for advisors' disappointment with their firms' lack of receptiveness was that firms may listen to advisors' feedback, but following through on it is a separate matter altogether.

"It's top-down management," says an advisor in Ontario with Toronto-based Bank of Montreal. "Our feedback is measured, but they're not necessarily going to make the changes."

Then there are advisors who wished their firms would be receptive to the ideas that all advisors present - not just the ideas of the biggest producers.

"I'm a small fish, so they don't really listen to me. My colleague is a bigger fish, so they listen to him a bit more," says an advisor in Ontario with Markham, Ont.-based Worldsource Wealth Management Inc.

Access to management praised

On the other hand, advisors offered much praise for firms that take their suggestions seriously and also make it easy to provide feedback. This includes firms at which advisors have easy accessibility to the firm's executives, such as the smaller independents or regional brokerages.

"We really have an open-door policy. You can talk to the CEO or the [chief financial officer] directly," says an advisor in British Columbia with Calgary-based Leede Financial Markets Inc. "I've been at a lot of firms where you could never do that."

But it's not only smaller firms that can succeed in being receptive to advisor feedback. In fact, advisors with Toronto-based Canadian Imperial Bank of Commerce (CIBC) praised the bank for providing plenty of opportunities and tools - such as an internal company website and direct contact with managers - to share their thoughts with the bank. Says a CIBC advisor in Ontario: "I don't have to go out of the way to give suggestions. They welcome it."

In addition to firms being receptive to advisors' feedback, advisors surveyed for this year's Report Card series said it's critical that their firms take the necessary efforts to keep advisors informed about the issues that matter to them, such as industry and regulatory developments.

"I think they do a good job, but I think we're sheltered," says an advisor in Ontario with London, Ont.-based Freedom 55 Financial, a dedicated sales agency. "They tell us what they want us to know; not what we need to hear."

On the other hand, some advisors said their firms are making significant efforts to keep them informed in order to help them stay on top of their businesses.

"I get at least three to four emails every week about things that are happening, training sessions and updates," says an advisor in B.C. with Mississauga, Ont.-based IDC Worldsource Insurance Network Inc.

© 2015 Investment Executive. All rights reserved.