What do I mean by that? Many client banks are mixed and range in value.
If teams are managing investments on behalf of smaller clients should these be managed in the same way as a higher value client? The answer from a compliance background is of course yes, however not all member firms have the ability or offer the correct value proposition, whether that be an online MPS-style investment or have a minimum DFM value of, say, £300,000 and above.
Boutique houses are looking to generational investment, family investments and to potentially service less clients who are HNW or ultra-HNW at the cost of the smaller value investor.
Are they being upfront and honest as to the business they are looking to manage as opposed to the larger players who potentially have mixed value clients either being over-serviced or under-serviced? How this looks and feels will be different across all member firms here in the UK and globally.
The UK regulator is looking at how clients are serviced across all member firms here in the UK in line with the suitability rules and of course consumer duty rules, as CISI Scottish committee member Jonathan Gibson wrote for FT Adviser last month, consumer duty is a cornerstone of ethical financial practice, mandating that financial service providers prioritise their clients' needs and interests.
These principles foster trust and ensure clients receive fair treatment, transparent information and products that meet their needs, even as firms inherit other operational locations through M&A.
If clients are managed out of a specific branch and the investment adviser is located elsewhere should firms consider matching the client postcode to the closest office?
There would be major resistance to this approach, however if your firm stands by its green credentials then investment advisers would not be racking up air miles or making long car journeys to meet with clients, claiming expenses, when they could be serviced locally, allowing investment advisers to concentrate on business development locally.
These are just some of the issues firms deal with as part of their day-to-day business, but on a greater scale M&A has brought reasonable-sized firms together.
Let’s not forget the major shareholders in all of this, they are the patient ones who sit and watch from the sidelines when M&A is announced to the market.
In most cases the shareholders will have been exposed to this in a past life, nonetheless it takes a strong executive team to deliver good client outcomes over the course of the integration even as they continue to look under the bonnet of any acquired business post completion of their due diligence.
