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Reaching an agreement

This article is part of
Guide to platform due diligence

Ensuring that the relationship between the adviser and client is respected by the platform should be a key point when considering a platform provider.

Due to the high level of dependency between platforms and advisers, Barry Neilson, business development director at Nucleus, says it is important for a detailed mutual due diligence process to be carried out.

Paul Boston, sales director of Novia, says the agreement reached between you and a platform is a commercial one. You have to satisfy yourself that the service and support provided by the platform represents value for money for your client, he adds.

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Mr Boston says: “I would want to know how the platform impacts positively on my client’s bottom line and assure myself that they outweighed any cost. Once you have signed a terms of business then you can start using the platform.”

Depending on the size and scale of the business, Alistair Wilson, head of retail platform strategy at Zurich, says a formal agreement best servicing both parties is beneficial.

The key is to ensure everyone understands what advisers and their clients expect and the provider can demonstrate its ability to deliver, he says.

Mr Wilson says: “Having a close working and operational relationship between adviser and platform is a real advantage to understanding what platforms are thinking and experiencing.

“It is also important to remember each is a business, independent of one another and keeping the relationship business like will ensure rational decisions are taken.

“This can be where having many different touch points between the businesses plays an important role.”

It is important that advisers fully understand the terms and conditions of the platform use and the relationship between platform, adviser and investor, says Stephen Wynne-Jones, head of marketing at Cofunds.