May 20, 2013

Bernie Clark: The 2013 IA 25 Extended Profile

Executive Vice President, Schwab Advisor Services

Photography by Tom McKenzie. Photography by Tom McKenzie.

This is Bernie Clark’s first appearance on the IA 25. Click here to view the complete list and Special Report schedule for extended profiles for each of the 2013 IA 25 honorees.

You could argue that the leader of Schwab Advisor Services is influential every year, owing to Schwab’s position as the largest by far of the RIA custodians measured by number of advisors and assets under management. It’s especially appropriate to single out Bernie Clark, who has led SAS since 2010, as one of the 25 most influential people in and around the industry by dint of his quiet but confident leadership in not merely growing Schwab’s custody unit, but in identifying and acting upon many of the most trying issues faced by advisors. Those issues include succession planning, practice management, technology, identifying and growing the next generation of advisors, and increasing RIAs’ prominence in the consumer marketplace and in the corridors of power in Washington.

Take technology, for instance. “Two years ago, our advisory board” of RIAs said “mobile is not a priority,” Clark said in an April interview, before pointing out “how quickly people can transition” to the benefits of mobile technology, particularly in working with end clients. Using mobile technology will eventually allow advisors to reach the point where “two or three meetings become one meeting.” Schwab has shown its commitment to mobile through apps for iPhone, iPad and Android devices to its Advisor Center technology platform.

Beyond mobile, Schwab’s nearly three-year-old Intelligent Integration project, part of an open-architecture “eco-system” approach that, Clark said, is a “10-year program,” allows advisors to integrate their standalone applications into the Schwab platform, such as what it’s already accomplished in CRM applications by working with SalesForce and Junxure. Last year, Schwab introduced MarketSquare, which allows Schwab RIAs to rate technology providers in a “Zagat-style way,” and also added an e-signature option for end clients through DocuSign.

On the RIA advocacy front, Clark said Schwab would be working with the Investment Adviser Association on the SEC’s announced plans to explore harmonization of RIA and broker-dealer regulations, arguing for a principles-based rather than a rules-based approach. On advocacy with an investor education twist, Clark said Schwab will continue to invest in its “RIA Stands for You” program though national advertising—“We’ll spend money on this for a long time”—will work more closely with the CFP Board, and will make available to end investors a directory of Schwab RIAs that investors can search by zip code to find their own advisors.

Clark is optimistic on the future for RIAs, whom he called “the most altruistic group I’ve ever seen,” even though the RIA industry is still in “its early days.” He is particularly optimistic when it comes to the next generation of advisors. His face lit up when he talked about Schwab’s efforts to support financial planning programs at places like Texas Tech University, University of California at Irvine, Virginia Tech and his hometown school of Arizona State University, where, he proudly stated, “he’s taught some classes.” He’s excited about Schwab’s Executive Education program, which provides advisors with access to online courses from schools like Harvard and Wharton to increase their business savvy, and about the new intern program that brings young people to Schwab for internships—“we’re hiring 10 interns this summer”—who will eventually be available for hiring by Schwab-affiliated RIA firms. The firm continues to find success and provide much-needed help to advisory firms through its Insight to Action Program (ITAP) program, which helps firms both grow their businesses and create succession plans, along with its succession lending program.

The students he’s met at those financial planning schools around the country “sound like us,” Clark said referring to baby boomers, and are “purpose motivated.” In their work lives, “they want to have deep relationships” with clients, he reported. “They don’t care about what happened” in the past, “but about the future.” They’re more interested in the “alternative” business model of the RIA, he said, though he suspects that “in another decade or so,” the RIA path “may not be the alternative,” but the default approach, since when it comes to innovation and entrepreneurship, the RIA model is more the “Apple than the Microsoft model.”

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