More than four in 10 Canadians either believe they do not pay their financial advisors or are uncertain about how their advisors are compensated, suggests new research from Mississauga, Ont.-based Credo Consulting Inc. in partnership with Montreal-based TC Media’s Investment Group.

Although 58% of respondents are aware their financial advisors are charging for services, 22% believe they’re not paying their advisors anything and 20% are simply unsure of whether they’re paying their advisors, according to the new report, entitled Your true value proposition: the must-know financial advisor literacy survey.

Ozy Camacho, publisher of TC Media’s Investment Group, presented the report’s findings at the 2015 Distinguished Advisor Conference in Puerto Vallarta, Mexico on Wednesday. (TC Media’s Investment Group publishes Investment Executive and its Montreal-based sister publication, Finance et Investissement.)

The research was based on the responses of 2,002 Canadians who were on a panel designed to be representative of the Canadian population. Survey participants were polled online in October in the first of a series of surveys in which 1,000 Canadians will be polled each month during the next year.

Some of the research is meant to gauge what investors think about their financial advisors and whether those opinions may change in the near future. The timing of these surveys will help determine if Canadians feel differently about their advisors following the implementation of greater fee disclosure that will be required in 2016 under the second phase of the client relationship model (a.k.a. CRM2).

“We want to help advisors deal with [the change] before it is a reality,” said Camacho. “If we communicate to advisors that clients don’t know what they’re paying, advisors still have time to change things.”

The survey also points out the areas in which advisors can show value in the face of growing competition from new entrants, such as robo-advisors.

The findings show that the greatest proportion (25.7%) of Canadian investors stated “investment management” as a key service provided by their advisors. “Retirement planning” came in second place (19.5%) and “education and information” was the third- most popular response (11.5%). Among the least popular responses were “estate planning” (4.6%), “insurance coverage” (3.8%) and “charitable giving” (0.9%).

“If [investment management] is what your clients think you bring to the table, then I can tell you that technology, such as robo-advisors, can do product selection, [portfolio] diversification and asset allocation faster and cheaper,” Camacho told the audience of financial advisors.

Advisors must communicate the full range of the services they provide, she added.

The results of the survey also suggest that Canadians do not have the most positive impressions of their advisors. Survey participants were asked what personality traits they believe their advisor possesses. More advisors are perceived to be professional, with 67% of Canadians believing this to be the case, than they are honest (55%) or trustworthy (58%). A small proportion of Canadians (5%) believe their advisors are intimidating, overbearing, controlling and aggressive.

“You would like to think that no one ever ascribes those [qualities] to their financial advisor,” says Hugh Murphy, managing director of Credo Consulting. “Those percentages are very low … but they do exist.”

Survey respondents were also asked how much they appreciate their advisors’ services. More than half of the respondents (56.1%) are satisfied with their advisors. One in five (20.8%) say their advisors’ services are “worth their weight in gold,” an opinion that is likely to encourage these individuals to refer their advisor to others.

However, 17.7% of respondents stated they were only getting fair value for their fees, and 5.4% question what they are paying for altogether.

The latter two responses indicate that almost one-quarter of Canadians are in the “switch zone,” Murphy says, which means there is risk that these clients will defect to another advisor.

The margin of error in this survey is approximately 2.45%, 19 times out of 20.

Editor’s note: For more survey results, watch the slideshow Do men and women clients really differ?