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Voices of Authority: The IA Presidents' Poll

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For the first time this year, when we sought to measure the independent broker/dealer world for the IA Broker /Dealer Directory, we sought direct input as well from the presidents of those firms. We are delighted that of the 76 firms that took the time to complete the B/D survey, 72 of the presidents of those firms participated in the IA Presidents’ Poll. What they had to say was interesting.

For example, the presidents are quite united in their answers to some questions–such as when asked about the short-term and long-term challenges for their firms: recruiting was the overwhelming choice–61.1% saying it is their biggest short-term challenge; and 42.3% say it’s their top long-term challenge. Increasing margins was the short-term priority for 21.4%. Over the long term, improving the clarity of regulation is the next-biggest challenge, for 26.1% of the presidents.

The presidents were united in what the biggest challenges are for reps, too, though not as emphatically: they say offering more sophisticated solutions for clients is the number one challenge for reps, with 36.1% saying it’s the biggest short-term challenge, and 29.2% asserting that it’s their top long-term challenge.

The Financial Services Institute is, to 76.1% of the presidents, the most essential association or entity for advancing their point of view, with NASD garnering 21.4% of presidential ballots, and SIFMA 13.5%.

IA asked the presidents if they expect the appeals court ruling vacating the broker/dealer exemption rule to change significantly how their firms are structured, and the answer was a resounding, 90%, “No.” They were a bit more divided over whether they feel new legislation or regulation is needed to resolve the unintended prohibited transaction or principal trading rules. Here, 67.2% say “No,” it is not needed; 32.8% say “Yes,” it is needed.

And what’s the most important issue facing the investing public? Karl Lindberg, president and CEO of ING Financial Partners, put it well when he wrote that it was complex regulatory rules: “Good representatives will always do their best to educate their clients and follow regulatory rules no matter how difficult the process becomes. Unfortunately, no amount of regulation will stop a bad representative from hurting their clients, their firm, and the reputation of our industry.”



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