The birth of the modern-day wealth adviser

Written by: Sophie McCarthy Posted: 08/03/2021

BL72_wealthadviser illoAs wealth holders crave a more holistic understanding of their needs, and as trust in governments and institutions falls, demand is growing for a new model of wealth adviser. So what do wealth holders really want from them, and how can advisers equip themselves?

“I had a conversation with a client recently, who explained that what she really needed was an educated best friend,” says Arabella Murphy, Founding Director of Propitious, a strategic consultant and mediator for wealthy families and individuals. 

“The woman in question is going through a divorce. She already has a solicitor and the couple are going through mediation.

"But what she wanted was someone who could help her navigate the process and make sense of the offers that were being put in front of her. Did they really fit with what she had in her head for the future? She wanted to fully understand if she would be able to live in the sort of house she wanted, and have the right amount of time with their children. 

“Importantly, she also wanted reassurance that what she was getting was an honourable result for all – she didn’t want to beat up her ex-husband to the last penny.” 

This dramatically different way of working – based on two parties acting as partners, as opposed to a traditional client/adviser relationship – is becoming increasingly popular. 

And it demonstrates another shift that’s currently under way – whereby wealth holders arm themselves not just with one individual who is expected to perform multiple roles, but with several specialists offering different inputs. 

Russell Clark, Managing Partner at Carey Olsen, agrees that we are seeing a change to the role of the wealth adviser. What clients are looking for hasn’t actually changed, he says, but in the past there’s been a disconnect between client requirements and the support they’ve received. 

“Clients are, and always have been, looking for a trusted adviser, somebody honest and well connected,” he says. “Crucially, they are looking for someone whose judgement they have faith in.” 

Independent streak

Independence is also key to Clark. “The wealth adviser who is not independent will struggle,” he continues. “There will always be a role for the services they provide but the idea that any one individual will be the go-to person for a private, sophisticated client is dated. 

“You may be the person to whom the trusted adviser turns, once they have determined that the product you are selling is what the client needs. But anyone who pretends that they know everything about everything, that’s all they are doing – pretending. It’s impossible. 

“For me, the future of this work is about building a network of like-minded people, who think like you and work like you, and who are experts in their respective areas. So, when you have a client who comes to you with a problem you can’t solve with your own knowledge, product or skillset, you know who to go to and you can introduce your client to that person. 

“The best advice you can give is: ‘I can’t help you, but I know someone who can’, rather than trying to sell a product or a service that isn’t what someone needs.”

This might mean arranging an introduction and standing back to allow a relationship to develop between the clients and the third party. But that shouldn’t be a threat. “You win kudos that way,” he says.

Clark and Murphy say today’s client advisers need to be more akin to general practitioners, calling on specialist advice as they need it. But where has this change in desire and direction come from?  

Claire Machin, Group Director, Head of Private Wealth, at Suntera Global, believes the shift is being driven by instability and uncertainty in countries around the world. 

This is causing high-net-worth individuals to worry about the future of their wealth – and a single adviser’s ability to navigate them through it. 

“Clients want to be able to rely on their advisers for reassurance and an element of safety. Advisers, meanwhile, are beginning to understand that clients will require a more bespoke approach in order to accommodate and compensate for this ever-changing landscape. 

“This was acutely highlighted during the pandemic, which is still affecting our lives and will continue to do so for some time.” 

Robert Broughton, Senior Client Adviser at UBS Jersey, largely agrees, but adds that there is a “bigger picture” at play here, too. 

“What we’re seeing is an inescapable structural shift in the way that our economy operates,” he says. “This change is part of the fourth industrial revolution – the automation of traditional manufacturing and industrial practices using modern, smart technology. 

“Consider the current pandemic. This is an example of an extraordinarily disruptive event, but it is an overture to another, greater disruption. Industrial revolutions are, as the name suggests, revolutionary. Society is transformed in these periods of economic upheaval.” 

BL72_wealthadviser illo2Brave new world

If this is the case, then how might advisers prepare themselves for this brave new world? “It’s fair to say that advisers are expected to have a broader knowledge base than was the case when portfolios were dominated by traditional asset classes such as equities, bonds and cash,” says Broughton. 

What is required, Broughton says, are people who can find long-term opportunities in trends that have been accelerated by the pandemic or the fourth industrial revolution. Ones that can help power a renewable future, and that tackle problems faced by us all – a more indebted and unequal world, but one still concerned by sustainability. 

Advisers should, according to Broughton, be able to direct clients on how they might benefit from such trends, and indeed the investment vehicles that will enable them to access these themes.  

For Machin, however, education is only part of the equation. “Keeping on top of current affairs and global economics goes without saying,” she says, “but practical exposure to these issues and gaining experience from peers and other advisers, as well as living through client situations and learning from them, are also key. 

“Advisers who have had experience within different institutions will often have the edge that is required these days. 

“Consideration also needs to be given to multi-generational families who are potentially living in different jurisdictions,” she continues. “As such, wealth advisers will need to take special care to keep up to speed with international changes, to ensure that advice meets these needs in the present and in the future.” 

Murphy, too, draws on the complex nature of multi-jurisdictional families and the part that their financial affairs might have played in this movement. 

She believes that for those with “lots of things going on in lots of different countries”, a desire to unpick their intricate spider’s-web-like structures is tempting.

Simplicity appears to be a theme that emerges time and time again around this topic. The need for bespoke, as opposed to one-size-fits-all advice is evident. 

A finger on the pulse is also a prerequisite, as is a desire to understand and solve newly emerging problems and to attempt to unearth the opportunity within them. But it’s this bold, client-centric approach that is transforming the way advisers do business and in turn how wealth holders respond to it. 

Murphy concludes that the real difference is “knowing that you are sitting completely on the same side as your client, and that nothing is inhibiting that”. 


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