Setting out the organisation’s vision for the future of advice, the Manifesto for Advice was launched with the backing of the Pensions Minister, Mike O’Brien QC MP, and the Rt Hon John Gummer MP, chairman of AIFA.
The core principles consist of six key areas covering advice, advisers and regulation.
There is an insistence that professional financial advice is focused on the client; advisers have an obligation to deliver the most suitable advice in the interest of their clients, advice firms should be free to operate commercially in whatever way best meets the needs of their business and clients and consumers should be able to obtain fair, expert advice.
Effectively the manifesto focuses on the need for independent and fair advice to be given to consumers by advisers, which remains within the boundaries of regulation and is clearly defined away from sales.
Chris Cummings, director-general of AIFA, admitted that advice should be kept separate from sales, as the two were distinctly different and advisers owed it to their customers to let them know who was on their side.
AIFA’s vision set out guiding principles, aimed at delivering a more skilled, professional and ethical adviser community.
The manifesto called for co-operation between the industry, advisers, consumers, providers and regulators to build a robust future based on the good practice that exists.
O’Brien said: “I very much welcome the Manifesto for Advice. This is really good stuff from AIFA. It represents an important step in the debate, setting a vision for IFAs giving advice in the future, and I look forward to seeing the progress IFAs make over the coming years as they put this manifesto into practice.”
Cummings added: “The manifesto sets out our guiding principles for the future of advice, which we believe should be embedded across the industry. For the principles to work in practice we need the support of regulators, government and consumers.
"Advisers have always put their client’s interests at the heart of their business. The manifesto will seek to endorse the extraordinary profession we have and recognise the exceptional value we as an industry provide.
“The manifesto fits well with the FSA’s move to principles-based regulation. The Retail Distribution Review has set in motion the appetite for change. However, we do not believe in change for change’s sake. We must ensure that any change has a direct benefit to the consumer. This presents a positive view of the future and it should chime with any IFA firm as we cannot decide the future alone.”
Gummer said: “We are trying to get people interested when they’re not. We need to take steps to go ahead and ask in order to increase their financial knowledge as those who teach are not experts. The future is in our hands and we need to make the FSA feel it doesn’t have to check us, we want to put clear water between advice and sales.”
Outcomes of the manifesto will aim to see higher levels of qualifications become the norm at entry level and beyond and the behaviour of individual advisers underpinned by a code of ethics and membership of a professional body.
Adrian Lewis, head of marketing at Burns-Anderson plc, said: “This is about advice and the value of advice. The point was made that financial and mortgage advisers are offering value to their customers, and people who give proper advice will keep their customers because they know that it is the right advice for them and their circumstances at the time.
"The message is where AIFA stands out is on support and advice as a valuable commodity.”
