Aligned Versus Non-Aligned Advice

Should the term 'financial advice' be classified as either 'aligned' or 'non-aligned'?
  • Yes (74%)
  • No (22%)
  • Not sure (5%)

Our latest poll asks you to reflect on a suggestion to classify the term ‘financial advice’ as either aligned or non-aligned.

The question stems from our article this week on issues associated with industry self interest (see: Consumers Taking Back Seat to Self Interest), in which Connect Financial Advice Service’s Paul Tynan challenges his peers to re-think how the term financial advice should be positioned to the consumer.

Mr Tynan suggests aligned advice exists where the adviser is in a salaried or self-employed position, licensed via a bank or industry fund, and where there is a restriction of ownership of the client.  Non-aligned advice, according to Mr Tynan’s definition, is where the adviser is a self-employed business owner and there is no restriction with respect to client ownership.

The term ‘non-aligned’ can be closely associated with the concept of independence, while the term ‘aligned’ cannot.  But if the client receives appropriate advice, regardless of whether it derives from an aligned or non-aligned source, does the issue then become one based mostly in perception, rather than in reality?

There are a number of issues that can stem from this poll question, not least of which is debating how the terms ‘aligned’ and ‘non-aligned’ should be defined, whether they should be used at all, and the extent to which the terms would have meaning for the client.

There’s plenty in this conversation to discuss, and there is no right or wrong answer – just your opinion.  Let us know what you think…


  1. Don’t need more confusion for clients but ASIC should make it mandatory that every adviser clearly shows who their ultimate owner are and thus 90% of advisers need to show that they are “aligned’ to a big financial bank or institution and as such explain to the client why they only advise the client to use the “owners” products as that is essentially all they are allowed to use. ASIC can make this happen easily but do you think the banks with soooooo many hidden dealer group brands want this to happen. No or they would all be called NAB Financial Advisers, etc rather than hidden in other non banked named dealer groups.
    ASIC it’s not that hard to force this disclosure.

  2. I think the proposed declaration is, in principal, a good idea, but it does not matter to many clients, unless the adviser takes the time to draw the distinction.

    Is non-aligned just about ownership, or shelf fees or bonuses. Noe doubt oroduct manufacturers will find ways to get dealerships to give them preference.

    Right now, I object to having to disclose in my SOA that my AFSL MIGHT get bonuses from an insurer ( unknown to me) and where I never directly receive a penny of that bonus.

    And then there are those insurer owned AFSLs who pretend to have an open AFSL, but pay over-the-top commission if that insurers products are recommend

  3. With my business being licensed through an AFSL that is not owned by an Australian bank or financial services provider, I suppose I should vote for classification of advice.

    However I won’t. I do not believe that ultimately, the client cares if the adviser places their investments with a product that is provided by company who owns their licensee. All of the platforms or other products provided these days allow for diversification of investment assets and managers.

    Whether it be placed through an aligned or non-aligned provider is not of consequence. Ultimately it is not the product, it is the advice and strategies provided!

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