A fast-evolving regulatory landscape, changing consumer expectations and shifting investment considerations are forcing advisors worldwide to overhaul their businesses, according to new research.
So reports Natixis Global Asset Management in a new 2016 “Global Survey of Financial Advisors.” This 5th annual report, conducted by CoreData Research on behalf of Natixis, surveyed 2,550 advisors in 15 countries to assess their attitudes on, among other issues, business growth, portfolio construction, client-servicing, advice and investment challenges.
On balance, the survey authors positively view regulatory changes underway worldwide, most especially in advanced markets like the U.S., Australia and New Zealand. These countries have in recent years imposed new compliance requirements that, like the U.S. Department of Labor’s fiduciary rule, require advisors to put their clients’ interests first.
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“This client-first approach will… serve as a foundation for a stronger business model,” the Natixis report states. “At a time when investors are hyper-focused on fees, advisors who demonstrate their value… may be better positioned for growth.”
Nonetheless, more than 8 in 10 (81 percent) of advisors polled globally said that heightened regulatory and disclosure requirements will prove challenging to the growth of their practices. One reason: increased compliance costs, as monies will be needed to invest in new technology platforms, people and business processes.