This page contains a Flash digital edition of a book.
ADMINISTRATION


The relationship business expect the unexpected


If you ask a wealth manager what is special about the wealth management business, the chances are that they will refer to the importance of personal relationships with their clients. Indeed, the phrase “relationship business” is so prevalent in wealth management circles that some see it as hackneyed.


T Figure 1: What qualities best demonstrate empathy to you from a wealth advisory firm?


Wealth manager is good at listening and understanding my needs


The firm supports the wealth manager with the right tools to aid our communication


The wealth manager is personable, friendly and like-minded


The wealth manager and I have an open channel of communication at all times


The wealth manager has the right technical skills to deliver what I want


Behaviour and ethics


Our interests are aligned; we win and lose together


3 2


1. Based on qualitative responses from 50 end investors in the US, UK and Canada 2. Number of responses: respondents may have given multiple responses


56 FAMILY OFFICE: ASIA TOMORROW 7


10 9


16 25


he industry wouldn’t agree. The term may be widely applied – it may even be misunderstood – but when wealth managers talk of a relationship business, they are not being trite. To get to the bottom of this difficult concept, Scorpio


Partnership collected the views of 50 typical investors in the US, UK and Canada between 2009 and now. They also polled 200 wealth management firms from these markets to see how their perspectives differ. It was found that investors rarely think of their


relationship just in terms of the one-on-one time spent with their wealth manager. They consider the culture of the firm and the ethics of the industry as equally important indicators of the quality of the relationship. So to say “we are a relationship business” with real meaning, firms must take responsibility for


providing their individual wealth advisers with the right environment and the right tools to build effective relationships. More broadly, the wealth management industry needs to start to consider issues of best practice to build confidence in the quality of these relationships.


Banks will be banks At the simplest level, the clients who took part in the research felt a relationship-based business must at the very least show that it cares about its clients. This starts with the ability of the individual wealth manager to listen and understand the client’s needs. Many responses also said the environment in which


the wealth manager operates affects their ability to truly deliver empathy. For example, their responses referenced how firms support the wealth manager with tools and processes to identify and record the client’s expectations. Some also referenced whether wealth managers are trained with the right technical skills to match the client’s expectations. A few responses, particularly those in the US and Canada, focused on the ethics and behavior of organizations as a dimension in the relationship business. When investors were asked whether the industry of


wealth management is good at relationships, positive feelings started to dwindle, with 62 per cent of the investors who took part in this research saying wealth management as an industry was poor at demonstrating empathy. The 38 per cent who were more positive pointed to


“traditional” or “high-end” wealth managers that they felt have a culture of client service. This was particularly the case in the US. One US client observed: “I would do business with some of the high-end firms. They have values. But the big banks and wirehouses have lost their morals. If I can’t speak well of a firm, I won’t do business with them.” Among those who were more negative about the


industry’s relationship capabilities, almost half made unsolicited references in their responses to the “culture of banking” at large. Their responses focused on the excesses of the banking industry pre- and post-financial crisis, with particular reference to remuneration and the bonus culture. The view was widely held that those who go into the finance industries do so for personal gain


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80  |  Page 81  |  Page 82  |  Page 83  |  Page 84  |  Page 85  |  Page 86  |  Page 87  |  Page 88  |  Page 89  |  Page 90  |  Page 91  |  Page 92  |  Page 93  |  Page 94  |  Page 95  |  Page 96  |  Page 97  |  Page 98  |  Page 99  |  Page 100  |  Page 101  |  Page 102  |  Page 103  |  Page 104  |  Page 105  |  Page 106  |  Page 107  |  Page 108  |  Page 109  |  Page 110  |  Page 111  |  Page 112  |  Page 113  |  Page 114  |  Page 115  |  Page 116  |  Page 117  |  Page 118  |  Page 119  |  Page 120  |  Page 121  |  Page 122  |  Page 123  |  Page 124  |  Page 125  |  Page 126  |  Page 127  |  Page 128  |  Page 129  |  Page 130  |  Page 131  |  Page 132  |  Page 133  |  Page 134  |  Page 135  |  Page 136  |  Page 137  |  Page 138  |  Page 139  |  Page 140  |  Page 141  |  Page 142  |  Page 143  |  Page 144  |  Page 145  |  Page 146  |  Page 147  |  Page 148