Choice – the solution to conflicts for AMP
For Australia’s biggest financial planning dealer groups, managing conflicts is all about ensuring advisers have adequate choice.
While the Australian Securities and Investments Commission’s new industry codes of conduct and regulations are on the horizon, AMP Financial Planning chief operating officer Neil Macdonald says the dealer group started dealing seriously with conflicts of interest in 1997, when it decided to begin putting products other than its own on the approved list.
“There are eight lending products from the banks on the list in addition to the various AMP products advisers can use,” he says.
“It is a board approved list, and we have tried to minimise any bias in remuneration to the adviser.”
An example of this is the superannuation platforms, where there is no bias as to which one an adviser decides to use.
“When we looked at conflicts of interest we looked at all potential areas where conflicts could arise, and acted upon these,” Macdonald says.
“AMP Financial Planning has a conference, but we have now said advisers cannot go to other fund managers’ conferences.
“We thought there might be a conflict, so we erred on the side of caution.”
He says when there was a potential conflict, the dealer group has decided it is not something to be avoided but a situation that needs to be managed.
Another action AMP is taking is presenting sessions on conflicts of interest at its professional development days.
“There are always times when an AMP product is the right solution for the client to meet their needs and goals,” Macdonald says. “But that is about using a product in a strategy that meets the client’s requirements.
“Certainly now we are about making a priority of the structure for the client, rather than selling the product.”
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