Sanlam’s Lawrence Cook said the firm is “pretty pleased” with the advisers that have chosen to stay following its fee hike last year.
Speaking to FTAdviser, Cook said he understood Sanlam’s model was not fit for every firm and some firms had decided to leave, though he would not say how many.
The main catalyst was that last year, Sanlam hit its adviser firms with a change to its fee model, which saw all appointed representatives charged a minimum of £20,000 regardless of their size.
Following this, many firms handed in their notice and left the adviser network.
But Cook shrugged off the exodus, saying: “With all organisations, whether it's us, or anyone else, you need to decide what quality of proposition you want to put forward, and we want to provide quite a high quality service and that comes with a certain price tag.
“We recognise that this does not mean it is tailored to fit every single firm so some firms have decided to leave because they want a different model, a different service elsewhere and I think that's fair enough but we had to focus on the firms that were likely to take us to the place we want to be as a business and respond to their needs.”
He added: “We wish them well for the firms that have left, but equally we're pretty pleased with the ones that are staying with us, and growing quite well.”
He explained Sanlam has taken a financial stake in some of the firms to help with succession planning.
Cook also said the firm had been supportive to advisers in how it has gone about making service proposition changes and had been speaking with them for some time.
“There's lots of dynamic change going on in this industry so I guess that's not gonna be the last of it,” he added.
IFA concerns
Discussing some of the concerns IFAs have, Cook said they fell into one of three categories: revenue, risk and costs.
“Pretty much every time we speak to an IFA and ask what keeps them awake at night it will be one of those three things, if not all of them at the same time - particularly if you're a business owner or a director or partner in a business.
“They will be worried about risk, which will be regulatory risk, and all the other risks in running your business, they will be worried about the revenue coming in, is it going up or down, is it dependent on investment markets."
He added: "In terms of cost, that is an ongoing issue, and is related to scalability and streamlining of the business which is an area that advisers seem to want to talk about an awful lot at the moment.”
Elsewhere, Cook touched on the shift towards outsourcing for many advisers as they move away from “the person who does investments” to a providing a more holistic plan.
He explained clients would like to spend more time generally talking about the aspects that interest them, from their lifestyle and goals to their families.
However, often, Cook said, clients begin to lose interest when the part about portfolios and funds comes up.
“IFAs are focusing more time on speaking to the clients about the things they want to talk about,” he said.
“Progressively over the last few years, advisers have recognised that they’ve moved from being perceived as the person who just does client investments and gets the client the best product, to actually being a life and financial planner to help them live their life better.”
sonia.rach@ft.com
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