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Where advice firms deliver value for clients

1 June 2020

Advisers consider soft skills to be their greatest value-adding attribute, according to a new paper by discretionary investment manager PortfolioMetrix.

The paper, entitled The Insiders’ Guide to the Value of Advice, found empathy to be a leading attribute, with 76% of advisers surveyed including it in their top five.

Understanding a client’s life goals ranked second, with 49% of advisers citing this as a crucial aspect in communicating the value they bring to clients, while simplify and peace of mind shared third place with 47% of respondents listing these traits.

In addition to soft skills, building a personalised financial plan (41%), consistency and continuity (39%) and behavioural coaching (36%) were also considered important among the 194 advisers surveyed.

The paper, designed to provide an overview of best practice and a practical roadmap for advisers, also highlighted several factors which were considered to be of much lower value to  advisers. These included helping with life events (11%), advice on non-investment products (4%) and being cost-conscious (6%).

Ben Peele, managing director, PortfolioMetrix UK, said there is a growing need for advisers to demonstrate their value to clients and understand if there are areas they are lacking in.

Peele said: “The FCA is increasing its focus on transparency and how advisers protect consumer’s best interests. While there’s currently no formal requirement for advisers to evidence the value they add, the direction of travel looks to be that way. Evaluating and quantifying value will not only provide the sort of evidence the regulator may want to see, it will help the adviser understand if there are any gaps that may need to be filled.”

He added: “Another aspect we cover in the paper, which is definitely worth consideration, is for advisers to survey their own clients to assess what they value from the relationship. This can be very useful for flagging areas where advisers can strengthen their offering and ensure they keep clients for the long term.”

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