Top 10 IFAs 2017: Best of the best

1st place: St James's Place

2017: 1

2016: 1

Four years at the top

St James’s Place (SJP) continues to race ahead in the stakes, as it retains its number one standing for a fourth year running. The value of its gross sales jumped a massive 28 per cent to £13bn in 2017 from £10.1bn in 2016.

SJP said the growth has been driven by the continued rise in the total number of advisers working across the partnership. As its client base has grown, so too has the scale of its partner businesses. It has developed from largely single adviser practices into small and medium-sized businesses.

At £86bn, group funds under management are up 20 per cent over the past 12 months

Celebrating its 25th anniversary this year, SJP said the firm was on track for a record breaking year. In October, for the year to date, it reported net inflows were up 41 per cent at £6.7bn, compared to the same period last year.  

At £86bn, group funds under management are up 20 per cent over the past 12 months. Celebrating its 25th anniversary this year, SJP reported it is on track for a record breaking year. For the first nine months of this year, it reported net inflows were up 41 per cent at £6.7bn, compared to the same period last year.  

Iain Rayner, joint chief operating officer, said: “Added to that, we’ve continued to enhance our offering to clients.  

“We launched an online cash management platform earlier in the year and recently announced changes to our range of funds, demonstrating the benefit of our distinctive investment management approach.” 

This included the launch of two new funds, changes to the personnel responsible for some of its existing funds and the introduction of a new Strategic Growth Portfolio.

Mr Rayner said: “First and foremost, we’ll carry on doing what we’ve always done so well, and that is to focus on our relationship-based approach to the management of our clients’ financial affairs.”

Another key focus for the business is to continue attracting advisers, while also adding recruits through the SJP Academy. 

An additional 51 advisers will graduate through its academy in November.

Key fact

Net inflows were up 41 per cent at £6.7bn

2nd place: Hargreaves Lansdown

2017: 2

2016: 2

Still runner-up

Hargreaves Lansdown continues to chase St James’s Place for the number one spot, although the gap has widened a little bit more compared to last year.

Nonetheless, the value of gross sales at Hargreaves Lansdown grew by 32 per cent to £7.3bn in 2016 to 2017 from £5.5bn in 2015 to 2016. This means the company has jumped back to the level it saw two years ago, when the value of its gross sales stood at £7.4bn.

Danny Cox, head of communications, said: “What we do differently to other firms is we start from a premise that clients should select the service they want.”

The type of individuals Hargreaves Lansdown caters to ranges from people with £25 to invest right up to the more sophisticated investor.

Although it ditched its plans to develop a supplementary robo-advice service last year, Mr Cox explained that in many ways the company still offers a range of digital tools that enable customers to do an element of self-servicing.

Since the launch of the app in 2011, it has been downloaded 680,000 times.

Mr Cox added: “We focus on the user experience. If you want to look at your investment or make a trade, people can log in using a thumbnail.”

Earlier this year the app underwent a refresh to include new elements to improve the user experience based on what customers want to use the app for. These include a biometric log in and a watchlists tool, for keeping track of a range of investments, which sync across all devices.

Key fact

Gross sales jumped to £7.3bn from £5.5bn.

3rd place: Old Mutual Wealth

2017: 3

2016: 3

Strong growth sales keep Old Mutual in third place

Old Mutual Wealth has remained in the third position for another year. Its gross sales have jumped 25.9 per cent to £6.8bn this year from £5.4bn last year, but it still trails Hargreaves Lansdown by £500m. The gap has widened from last year when it was behind by £100m in gross sales.

Richard Freeman, chief distribution officer, said: “The business has enjoyed an extremely successful year, with results illustrating the strength of our controlled distribution strategy.”

Through Intrinsic, Old Mutual Wealth said it has invested heavily in the financial planning sector. It completed the acquisition of Caerus to strengthen the scale of its advised distribution business.

In addition the business has completed several small acquisitions for Old Mutual Wealth Private Client Advisers.

Old Mutual Wealth invested in the financial planning sector, acquiring Caerus to strengthen its advised distribution business

Mr Freeman said: “Financial planning sits at the heart of our distribution strategy and our business model continues to deliver exceptional results. For example, integrated flows rose from £0.7bn to £2.2bn for the six months to 30 June 2017.

“We also continue to support the growth of the financial planning industry through the Financial Adviser School, the not-for-profit training academy for the next generation of financial advisers.

“The school saw its first graduates complete the programme and take up careers in financial advice over the summer, with a strong pipeline of new graduates following them since then.”

As new advisers enter the market, undoubtedly the big challenges they will face include the Brexit process, Mr Freeman added.

Due to the limited developments in negotiations, 2018 is expected to be a tumultuous period.

More regulatory change is on the horizon, with Mifid and General Data Protection Regulation (GDPR).

Mr Freeman added: “Advisers will need support to implement necessary changes, and it is up to us to support them to manage change effectively for the benefit of their business and their clients.

“It is important that we continue to support advisers to help their clients recognise the benefits of a long-term focus and reassure them through periods of volatility.”

Key fact

Integrated flows rose from £0.7bn to £2.2bn for the six months to 30 June 2017

4th place: Openwork

2017: 4

2016: 6

Surge in adviser numbers pushes Openwork up Top 100

Openwork has jumped two positions this year following a substantial rise in the number of advisers it has brought in.

In August, the adviser headcount across the group reached 3,521, up from 3,008 at the same point the year before – an increase of 17 per cent.

Secondly, the company said the advisers within the network are becoming more productive by working more efficiently, spending more time with their clients and bringing in new business. This has benefitted the advisers and Openwork alike.

Advisers within the network are becoming more productive by working more efficiently

Philip Martin, marketing director, said: “We know that our scale generates buying power that we can use to offer stronger propositions to customers than the wider market, as we do with our investment offering. In an industry that is consolidating rapidly, it is pleasing that we remain a constant in the top 10.”

Other highlights for Openwork this year include the Omnis fund range, which has reached £5bn in assets under management (AUM).

It plans to build on the growth it has experienced in the past year by deepening its use of technology to allow it to reach more customers, more effectively.

However, there are market challenges and threats that could affect the business such as Mifid II and the Insurance Distribution Directive (IDD) drawing resource away.

But with the advice gap in the market it means that demand continues to outstrip supply.

Mr Martin said: “The market is very strong; quite simply, there are too few advisers to service the needs of the market. It’s a great time to be an adviser.”

Key fact

Adviser headcount across the group reached 3,521, up from 3,008

5th place: Brewin Dolphin

2017: 5

2016: 4

Winning support

The regulatory requirements as a result of pension freedoms has driven the value of gross sales at Brewin Dolphin. The firm saw an 8 per cent increase in the value of gross sales it now deals with compared to last year.

Antony Champion, head of strategic adviser partnerships, said: “What advisers are finding is these types of clients need more help and support, particularly when they are moving from a final salary scheme. So our relationships with advisers have come into play, where we are running more bespoke portfolios for the clients.”

Brewin Dolphin plans to continue investing  in technology

The company has 28 offices spread around the UK, where advisers can come to speak face-to-face about their requirements.

Most advisers are looking for the same things. They want help with managing their clients’ money, but this has become even more prevalent since pension freedoms, as cases have become more complex.

Brewin Dolphin plans to continue investing in technology to make it easier for advisers to deal with the company.

Mr Champion added: “We need to make sure our advisers and our clients can get access to their portfolios, annual statements and quarterly statements as easily as possible. All of those things need to be continually upgraded and improved. I’m incredibly pleased we are still within the top 10. We worked very hard to stay there.”

Key fact

28 offices spread around the UK

6th place: Tenet Group

2017: 6

2016: 5

Steady as she goes

Tenet Group’s gross sales have continued to grow at a modest rate compared to its peers. It achieved sales of £2.2bn in 2016 to 2017, up 4.8 per cent on the same period in 2015 to 2016.

Connect Advisers, the division of Tenet Group that deals with pensions, has been very busy dealing with defined benefit (DB) transfers. It is an area that continues to be seen as high risk, but Tenet Group group risk and regulatory director Caroline Bradley said that the network’s approach of pre-approving each case, gives an added layer of protection. After an adviser has approved a transfer, it has to be checked over again by a member of Tenet’s advice standards team, who will also have a CF30 qualification.

Connect Advisers, the division that deals with pensions, has been busy dealing with DB transfers

An area of growth in the future is likely to come from the equity release market, as Tenet is seeing more cases. As a result it has started to roll out more training for advisers on equity release.

It is also continuing to make headway on its practice buy-out programme for retiring principals, who can retire knowing that they will have professional indemnity insurance (PII) cover for the rest of their life.

On upcoming plans, Tenet is working to improve the way its advisers are paid. Under the changes, advisers will be able to upload information to one system instead of two, to enable the payments to be made in an easier way. Tenet is also enhancing its back office systems and has launched a platform.

Key fact

Tenet achieved sales of £2.2bn in 2016 to 2017

7th place: Succession

2017: 7

2016: 7

Acquisition strategy keeps Succession in seventh spot 

Succession has remained in seventh place for another year. Despite this, it has seen a £200m increase in the value of gross sales it has done. Funds under management have risen to £5.6bn, a compound annual growth rate of 34 per cent since the formation of its advisory business, Succession Group, in January 2014.   

Succession’s acquisition strategy has also helped to drive the growth for the business. It has acquired 10 businesses so far in 2017 and expects to acquire its 50th business in January 2018. The company has also increased its employee headcount by 16 per cent this year and it has pledged to continue investing in client-facing and management teams, technology and infrastructure.

Engaging millennials in what we do as wealth managers and what we can do to engage younger generations in the task of saving for the future is a focus

A number of highlights at the firm include the roll-out of its Planner Academy in June, the launch of its female focused National IFA – Independent Women, and a revamp of its Employee Benefit Solutions.

The company will also be introducing Succession Independent Schools specialist propositions to provide a tailored service to meet specific client needs.

James Stevenson, managing director, said: “We are incredibly proud of our team and all we have achieved. We’ve moved way beyond our original objectives and now aspire to be seen as the best privately owned, independent financial planning and wealth management business in the UK.”

The year has not, however, been without its bad news. Earlier this year, founder Simon Chamberlain passed away.

Mr Stevenson said: “Following the tragic loss of the business’s founder we believe our leadership team and our people are well equipped to handle all challenges. Engaging millennials in what we do as wealth managers and what we can do to engage younger generations in the task of saving for the future is a focus for us.   

“Our scale and profitability enable us to continue to invest heavily in our technology and we expect to expand our Succession Generations programme appropriately.”

Key fact

Succession has acquired 10 businesses so far in 2017

8th place: Investec

2017: 8

2016: 9

A solid one-position rise 

Investec is in 8th place this year, seeing its sales jump by £300m over the past 12 months to £1.8bn. Mark Stevens, head of intermediary services, has put this growth down to the way in which the firm has tried to differentiate itself in a number of areas.

He said that IFAs are given access to an investment manager, to enable them to build stronger relationships with the individuals who make the decisions about the investments. This structure also gives the client an assurance and allows them to ask questions that can be explained there and then.

Additionally, all clients, no matter the size of their investment pot, are given access to an investment manager.

All clients, no matter the size of their investment pot, are given access to an investment manager

With the investment process, Mr Stevens said Investec adopts a flexible approach. This means they do not impose model portfolios on the clients, which enables the DFM to amend the investment approach to reflect the client’s requirements and circumstances.

Growth for the business has also been driven by the the effects of RDR and pension freedoms, which has driven many IFAs to outsource their services to DFMs.

As Mifid II approaches and General Data Protection Regulation (GDPR) kicks into force, Mr Stevens predicts that this will bring about more changes that could drive further growth for the firm.

He said: “With Mifid II, investment managers will look at efficiencies and changes to see where they can add the greatest level of value to their client relationship. Most of them really enjoy meeting with their clients and advising them. If they can outsource some of the day-to-day investment management it does enable them to meet with their clients, and identify needs and opportunities.”

Key fact

Sales jumped by £300m over the past 12 months to £1.8bn

9th place: Brooks Macdonald

2017: 9

2016: 11

Brooks Macdonald enters into the top 10

Climbing up the rankings this year by two spots, Brooks Macdonald has attributed its growth to a loyal and growing client bank. As a result of this it has entered into the top 10.

Director Michael Owen said: “There continue to be opportunities for professional, fee-based advice and our people are exceptionally well placed to deliver on that.

“We are in a very competitive marketplace and for a business with fewer than 20 advisers, it is a tremendous accolade to be in the top 10 firms nationally when compared to companies many times our size. This really is the result of an excellent team of people working together.”

With fewer than 20 advisers, it is a tremendous accolade to be in the top 10 firms nationally

Despite the uncertain political landscape, Mr Owen said stock markets have been supportive and with low interest rates, investors have continued to look for deposit-beating returns for their pensions and savings.

It is not surprising that the challenges the company sees ahead include Mifid II and GDPR, mingled with the impact of Brexit.

But the company continues to have a positive outlook.

While events might lead to a period of short-term instability, it is confident in the medium term outlook.

Key fact

Brooks Macdonald climbed up the rankings this year by two spots

10th place: In Partnership (formerly On-Line Partnership)

2017: 10

2016: 19

Massive leap up

The company has broken into the top 10 after jumping a whopping nine places. Over the past 12 months it has worked with its members to increase their time in front of clients by trying to make their businesses more efficient. These actions include a comprehensive structured CPD, integrated research system with In Partnership’s own customer relationship management (CRM) platform, marketing and flexible business models.

Director Stephen Baldry said: “This recognition demonstrates and confirms our passion for developing adviser businesses and providing first class client outcomes. We believe that this accolade stems from In Partnership’s unique culture.

“In Partnership provides advisers with a close, personal network where everyone is recognised for the important contribution they make. For example, members can engage with the management team and directors on a regular, first-hand basis. From sole traders to large multi-adviser practices, we work to ensure all members recognise that the network is a partner, offering support and always there to rely on.”

Training has also been a key driver for growth.

In Partnership is planning more structured educational events

Chief executive Kevin McDonagh said: “This year’s comprehensive training programme is something of a highlight for 2017. In particular, we have covered advanced regulation preparation at great length – from Mifid II to GDPR. These training courses are something we at In Partnership are incredibly proud of because we take education seriously.”

Amid the growth, the team at In Partnership is also keeping a keen eye on looming threats.

These include Brexit, low investment returns and increased mortgage rates, but the biggest challenge, Mr McDonagh said, is attracting new adviser talent.

Keen to address these issues, In Partnership is planning more structured educational events, to help advisers understand the risk and return if a market correction were to occur. It is also developing digital tools and also wants to expand its investment, protection and mortgage propositions.

Key fact

The company has broken into the top 10 after jumping nine places

Ima Jackson-Obot is features writer at Financial Adviser