- Yes (77%)
- No (17%)
- Not sure (6%)
Most advisers think that consumers’ interests will be better served if financial institutions did not own advice networks.
That’s the conclusion we can draw from the reults of our latest poll, in which three out of four of those taking our poll (75%) agree with this contention. Around one in five (19%) disagree that dismantling vertical integration structures would better service client best interests, while 7% are unsure.
The debate over the merits of vertical integration and the potential conflicts of interest (real or perceived) inherent in such structures, has been brought to centre-stage over the last fortnight by the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
Following the Royal Commission revelations, we’re seeing both ‘trade’ and mainstream media commentators debating vertical integration and mounting arguments for institutions to completely divest themselves of any ownership of advice distribution.
Elsewhere, one adviser commenting on this poll has noted the leverage that exists within the banking world in which the packaging of various financial products and services can be made to appear very attractive to the bank client, possibly at the expense of other products or services that may better serve their best interests.
We note there has already been a move away from vertical integration within the financial services sector in recent times, and that more divestment is probably around the corner. But again, our question is whether institutional divestment of advice networks is a good thing from the consumer perspective. Does it serve their best interests?
Our poll remains open for another week and we welcome your views, as always…
