This article appears in the June 2022 issue of Investment Executive. Subscribe to the print edition, read the digital edition or read the articles online.
Dealer firms have made notable changes to their client account statements and online portals, but advisor feedback in the category remains mixed in the 2022 Dealers’ Report Card.
The performance average for the “client account statements” category, which assesses both the statements and digital client access, improved slightly over last year’s Report Card. But, once again, the category was among the lowest performing in the Report Card. The category improved by 0.3 compared with 2021, coming in at 7.9, but was still 1.6 points below the highest-rated category for 2022, “freedom to make objective product choices.”
The average importance rating for client statements rose to 9.0 from 8.8 a year ago, and the category remains among the 10 areas with the largest gap between firms’ average rating and advisors’ expectations.
The top-rated firms in the client statements category were Carte Wealth Management Inc., which was rated 9.0, down from 9.1 in 2021, and Peak Financial Group, one of the four firms that were rated more than half a point higher than in 2021 (8.9, up from 8.2).
“[The client portal] is user-friendly; clients can go and access it themselves,” said one Carte Wealth advisor. Another of the firm’s advisors said the statements are “very easy to understand now.”
Maria Jose Flores, president and chief compliance officer with Carte Wealth, said the firm improved client statements in several ways prior to the final implementation of the client-focused reforms.
“We basically tell [advisors and clients] where there’s conflict of interest, how they can avoid it [and] how they can mitigate it,” Flores said. The firm has educated both parties on the new features, calculations and “look plus feel” of the statements, Flores said: “This has created a lot of transparency.”
Regarding Peak’s client statement resources, one of the firm’s advisors in Ontario said, “They have been upgraded and improved,” while other advisors at the dealer noted that the better online access has led to more autonomy for clients.
Rather than make a lot of tweaks to the information on the statements, which are “pretty well-regulated,” the dealer focused on building out the firm’s client portal, My Peak Online, said Peak’s founder and CEO Robert Frances.
Frances said Peak hired staff with expertise in user experience (UX) and user interface (UI) for the project. “We made it responsive to mobile media. We also made some aesthetic changes to the statements,” he added.
The other three firms that saw significant and positive year-over-year improvement in their client statement ratings were Desjardins Financial Security Independent Network (DFSIN; 7.3 up from 6.2), IG Wealth Management (8.3 up from 7.3) and Investment Planning Counsel Inc. (IPC; 7.9 up from 7.1).
DFSIN’s rating was lower than the performance average (7.9), however, and the dealer received the second-lowest rating in the category this year.
“The clients are constantly complaining about the lack of information and that it’s not at par with the industry standard. The UX is archaic,” said one DFSIN advisor in Ontario.
But several advisors noted improvements were in the works. For example, an advisor in B.C. said, “We switched to Dataphile and it has gotten better, but [the statements] are still a work in progress.”
André Langlois, vice-president of life and health insurance and president of DFSIN, said the firm is doing its best to heed advisor feedback: “This is an area that we promised our clients and advisors that we will invest a lot of effort at improving.”
Improvements already made by DFSIN include adding more detailed information and tools that help monitor investment performance. The goal is a portal platform that’s “more modern, intuitive [and] easier to navigate,” Langlois said.
Manulife Securities, which was rated lowest in the client statements category, received a 5.3, down significantly from 6.9 a year ago.
While the clarity of Manulife’s client statements was widely flagged as a problem, along with dated portal technology, one of the dealer’s advisors in Ontario said the firm is working on these issues: “They just made an improvement on the statement side of things. Portals are a pain point for clients, but [Manulife is] moving in the right direction.”
Another advisor from Manulife in Ontario said, “They could improve on visuals. Bolder ink, for instance, and [have] better UI online. Make it a simpler design.”
Richard McIntyre, president and CEO of Manulife since March, said he’s aware of the issues and is working to address them. He also commented on the impact of the client-focused reforms and the difficulty of timing technology improvements.
“Getting the CFRs right is tough,” he said, explaining that the statements are “in better shape nowadays” but that their improvement also is part of a larger, long-term project. One step the firm has taken is partnering with companies such as Morningstar Inc. to address know-your-product challenges.
McIntyre noted that work on improving client portals began in early 2021 and will continue. One planned feature is householding, which allows for easier grouping of client accounts and data.