New research from Old Mutual International, part of Quilter, shows that international financial advisers believe that their biggest challenges in 2019 were regulatory changes, a slowdown in the global economy and attracting new clients.
Advisers were split on which of the challenges they deemed to be the biggest with just 2% between the top three choices. Regulatory change was the most popular with 16% of advisers saying it was their single biggest challenge.
This was closely followed by 15% of advisers saying that their biggest challenge was a slowdown in global economy with a further 14% saying it was attracting new clients.
With two huge pieces of regulation coming in the last couple of years in the form of MiFID II and the Isle of Man’s new Conduct of Business Code, it’s no wonder that advisers selected regulatory change as their biggest challenge this year."
Two new pieces of regulation have been brought in over the past two years, such as MiFID II in 2018 and the Isle of Man's new Conduct of Business Code, introduced earlier this year.
Similarly, in November 2019, the Organisation for Economic Co-operation and Development (OECD) released a report which forecasted that the global economy was only set for continued growth of around 3%.
Brexit did not feature high on the list of concerns, with just 8% voting for this option. When advisers were asked what impact Brexit had had on their clients, 47% said that there had been no impact at all. A further 31% said that the impact had been that more clients are choosing to invest their assets offshore.
One adviser commented that: ‘Clients are simply a lot more nervous about investment decisions' which was a view echoed by many.
Conversely, respondents believed that retaining advisers or staff in the industry was not a challenge during 2019 with just 1% voting for this as their biggest challenge.
Commenting on the findings, Old Mutual International, CEO Peter Kenny said, "With two huge pieces of regulation coming in the last couple of years in the form of MiFID II and the Isle of Man's new Conduct of Business Code, it's no wonder that advisers selected regulatory change as their biggest challenge this year. Shifts in regulation can be hard to keep track of and time consuming particularly when running a hectic business yet advisers have proved their resilience and adapted remarkably well despite the challenges.
"However, the survey results show that a myriad of challenges are playing on the minds of international advisers this year and while regulation tops the list, a perceived slowdown in the global economy and attracting new clients represent difficulties too.
"Keeping pace with regulatory change is no mean feat but it's essential that financial advisers evolve or risk falling behind. For this reason, Old Mutual International designed its Future Fit programme to help advisers through regulatory change which complements its high-quality technical support."
Old Mutual International surveyed 180 respondents from across the UK, Europe, Middle East and Asia in November.