{"id":32486,"date":"2016-02-23T12:33:52","date_gmt":"2016-02-23T01:33:52","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=32486"},"modified":"2016-02-24T07:45:30","modified_gmt":"2016-02-23T20:45:30","slug":"should-all-sales-based-incentives-be-banned","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2016\/02\/23\/should-all-sales-based-incentives-be-banned\/","title":{"rendered":"Should all Sales-Based Incentives be Banned?"},"content":{"rendered":"<div id=\"polls-158\" class=\"wp-polls\">\n\t\t<div class=\"pollHeader\"><strong>Do you agree that sales-based incentives are the main reason that Australian consumers mistrust financial advisers?<\/strong><\/div><div id=\"polls-158-ans\" class=\"wp-polls-ans\"><ul class=\"wp-polls-ul\">\n\t\t<li>No <small>(74%)<\/small><div class=\"pollbar\" style=\"width: 74%\" title=\"No (74% | 260 Votes)\"><\/div><\/li>\n\t\t<li>Yes <small>(21%)<\/small><div class=\"pollbar\" style=\"width: 21%\" title=\"Yes (21% | 73 Votes)\"><\/div><\/li>\n\t\t<li>Not sure <small>(5%)<\/small><div class=\"pollbar\" style=\"width: 5%\" title=\"Not sure (5% | 16 Votes)\"><\/div><\/li>\n\t\t<\/ul><div style=\"text-align: center\"><\/div><\/div>\n\t\t<input type=\"hidden\" id=\"poll_158_nonce\" name=\"wp-polls-nonce\" value=\"a72c20d225\" \/>\n<\/div>\n\n<p>Our latest poll is based on a new industry white paper in which it contends that incentives are the single biggest problem and main cause of consumer mistrust of financial advisers (see: <a href=\"https:\/\/riskinfo.com.au\/news\/2016\/02\/23\/insurance-commissions-leading-to-mistrust-of-advice\/\" target=\"_blank\">Insurance Commissions Leading to Mistrust of Advice<\/a>).<\/p>\n<p><!--more-->Named <a href=\"https:\/\/riskinfo.com.au\/news\/files\/2016\/02\/2016_And-the-walls-came-tumbling-down_Whitepaper_FINAL.pdf\" target=\"_blank\">&#8216;<em>And the walls came tumbling down: Why the industry must build a new foundation<\/em>&#8216;<\/a>, the title of the white paper is a metaphor for what its authors are seeking &#8211; a dismantling of the existing financial services structure in Australia, where the line between &#8216;product&#8217; and &#8216;advice&#8217; remains blurred, and its rebuilding. They seek a new advice culture in which there exists no conflict between product and advice, either real or perceived.<\/p>\n<h6>They seek a new advice culture in which there exists no conflict between product and advice, either real or perceived<\/h6>\n<p>While this principle is solid, many financial advisers will argue that they already operate under an advice philosophy that genuinely serves the best interests of the client &#8211; a values-based or needs-based or solutions-based philosophy that always has the client at the centre of the conversation. While many of these advisers still receive some or all of their remuneration by way of commission, they will argue this is totally disconnected with the nature and quality of the advice they deliver, including any products that form part of the solution that serves the client&#8217;s best interests.<\/p>\n<p>Others, including the white paper authors, would argue in turn that while this may indeed be the case, it&#8217;s not just reality, but perception that&#8217;s an issue, and that only the complete removal of any incentive-based remuneration and other incentive-based benefits will allow a perception change in the mind of the public.<\/p>\n<p>Along with incentives, the other underlying reason, according to the white paper, that Australians don&#8217;t trust financial advice, relates to the &#8216;industrialisation of advice&#8217;. This issue relates to the nature of advice delivered via large institutions, where the white paper asserts that the majority of advisers aligned to an institution don&#8217;t actually sell advice; they sell product. This is another contention that merits further discussion; one that we&#8217;ll come back to in a future poll.<\/p>\n<p>Meanwhile, take the time to read our <a href=\"https:\/\/riskinfo.com.au\/news\/2016\/02\/23\/insurance-commissions-leading-to-mistrust-of-advice\/\" target=\"_blank\">summary report<\/a> on the white paper and\/or <a href=\"https:\/\/riskinfo.com.au\/news\/files\/2016\/02\/2016_And-the-walls-came-tumbling-down_Whitepaper_FINAL.pdf\" target=\"_blank\">click through<\/a> to the white paper itself, if you&#8217;d like to get the complete picture of the landscape its authors are painting.<\/p>\n<p>As always, your measured comments will be most welcome &#8211; tell us what you think and make your voice heard&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Our latest poll is based on a new industry white paper in which it contends that incentives are the single biggest problem and main cause of consumer mistrust of financial advisers (see: Insurance Commissions Leading to Mistrust of Advice).<\/p>\n","protected":false},"author":3,"featured_media":32526,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,49,270],"tags":[4247],"class_list":{"0":"post-32486","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-compliance-regulation","8":"category-polls","9":"category-remuneration","10":"tag-feature"},"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/32486","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=32486"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/32486\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/32526"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=32486"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=32486"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=32486"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}