CompaniesSep 25 2015

Firing Line: Innes Miller

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Firing Line: Innes Miller

It is not all about the money for financial advisers taking the plunge and selling up shop to wealthy adviser conglomerates, according to Innes Miller.

Client welfare tops the list of priorities for planners when it comes to selling their business, Mr Miller added.

“Some advisers have had the same clients for between 20 and 30 years and are probably well-known in their local community.

“If an adviser sells out to a company that almost immediately hikes the amount that their client would be required to pay for advice, the adviser would probably not want to walk down the high street or go to the pub at the risk of bumping into people who were their clients and are now worse off”

Scydonia is a consultancy firm that provides business advice to financial advisory and wealth management businesses, as well as offering merger and acquisition services.

The latter is aimed at whipping advisory firms earmarked for sale into shape to maximise its value over an agreed timeframe.

Consolidation is the zeitgeist in the financial advisory sector as regulatory pressures, legacy trail commissions – not least the ever-complex investment sphere – are driving smaller advisory practices to the brink of their capabilities.

To cope with these challenges, smaller practices should tailor their proposition to serve their target market, Mr Miller said, adding: “If you are serving a client bank with a further range of needs and you are a small business, then you are effectively faced with two choices.

“One is to invest in the business and bring in people and the resources and capabilities that allow you to meet the needs of these people. The second is to sell up and work for somebody else with these resources.”

Weighing into the restricted versus independent debate, Mr Miller said more advisers were likely to adopt the former advice model because it removed the burden of providing whole of market coverage to the regulator at a time of heightened regulatory scrutiny – with MiFID II on the horizon.

Some advisers have had the same clients for between 20 and 30 years and are probably well-known in their local community

He added: “The whole debate is a bit of a red herring to be honest. From a client perspective the most important thing is the quality of service that is provided. Being restricted does not detract from that in any way.

“As we are seeing greater cost pressures on firms, also from a professional indemnity perspective, more advisers will ask themselves: do we really need to be independent? It is about being able to take a step back from the emotional attachment to the independent status and trying to look at the situation in the cold light of day.”

Mr Miller has had a long-standing career in the financial advisory consultancy business.

Prior to Scydonia, he served as head of business at Standard Life where he played an integral role in the creation of the life office’s new restricted financial planning business, called 1825.

The service was branded in May this year, following the acquisition of Skipton Building Society’s advisory arm Pearson Jones in February.

He said: “Standard Life is a great business and I think it is in a very strong position in the market at the moment.

“It has always been my desire to get back to doing something on my own again. With everything they were undertaking as part of 1825, when they got into the implementation side of things, I felt that it was the right time for me to take a step back.”

A lot has been said about the future of Standard Life amid the imminent departure of David Nish, who served as chief executive of the group for nearly six years.

The commonly held view is that Mr Nish’s replacement, Keith Skeoch, who is head of Standard Life’s fund management arm, will continue to build upon Standard Life’s shift in strategy from a traditional life office toward global asset manager.

Mr Miller agreed, adding: “David Nish has done a great job in transitioning the business. Keith is a great guy, and I think he is the right person to continue the strategy towards asset management.

“I think we will see a very different Standard Life five years from now. It will be interesting to see what changes are made.

“Will Standard Life remain committed to remain 100 per cent active only or will it recognise that there is so much of a trend towards passive that it might look to bring in the passive capability? It is difficult to say.”

“There is also the piece on technology. Companies such as BlackRock have purchased a digital advice company. It will be interesting to see if Standard Life will do the same.”

Mr Miller left the business in July to resurrect Cydonia, which he renamed Scydonia, which was set up by him in November 2002 – offering a similar service to life and pensions providers, fund management groups, wealth managers, financial advisers and private equity firms.

Outside the office, Mr Miller enjoys spending time with his two children, swimming, skiing, music festivals and rugby. He is currently training to become a qualified coach in the sport.

Myron Jobson is a features writer at Financial Adviser

Innes Miller’s career ladder

July 2015-Present (3 months)

Owner, director

Scydonia

February 2013-July 2015

Head of business services

Standard Life

July 2012-February 2013

Head of Business Consultancy, Threesixty Services llp

Standard Life

April 2011-July 2012

Business development leader, Central, Southern and Eastern Europe

Ernst & Young

January 2008-April 2011

Account director

Ernst & Young

November 2002-January 2008

Founder and director

Cydonia