Financial planners can play a back seat to the growth and design of technology, but doing so will only mean designers and regulators will take over and potentially create what they want instead – not necessarily what’s best for planners and clients, speakers told a session of the FP Canada’s Financial Planning Conference.
Neil Gross, Chair of the Ontario Securities Commission’s Investor Advisory Panel, said financial planners can either be a driver or a passenger on the road to future development of the tech industry. Being a passenger, said Gross, may not take planners where they want to go, so it’s better for the industry to empower itself and position itself to be a driver.
“That’s probably strategically a much better way to go than letting yourself be just a passenger and waiting to see what gets developed.”
FP Canada and the Institut québécois de planification financière (IQPF) have created the Fintellect Task Force to see how the professional financial planning industry should use new technologies that will help its members and increase accessibility for Canadians. The task force will soon be looking into how information it has already gleaned can be leveraged by the industry and put into the strategies of industry members, regulators, credentialling bodies and governments.
Gross, who is also a member of the Fintellect Task Force, said it’s imperative for both financial planners and the industry to become “agents of change” for the industry.
“It’s absolutely critical for financial planners individually and as a whole to become more conversant with technology at the design phase – the creation of the technological tools that will aid in financial planning and wealth management going forward,” he said. “If it’s left to the technology service providers to do it, they’ll create things that they think are solving the problem but they may not be defining the problem correctly and may not come up with the right solutions.”
On top of that, he said changes will probably not come from regulators at all. But he also said FP Canada and IQPF should step into the role of designing financial planning technology, especially if they are given both the mandate and the budget.
Christopher Dewdney, Principal, Dewdney & Co. and chair of the task force said participation by financial planners is crucial because there are a number of influencers on TikTok and Facebook putting out misinformation.
“[It’s key] to be able to use technology, especially those of us who are accredited, to get a proper message out to try to combat that misinformation and disinformation coming from unaccredited sources,” said Dewdney.
He said technology was never in the forefront of financial planning before COVID-19 and has now put the industry in a challenging position. But Dewdney added that planners shouldn’t fear the worst.
“Don’t think that technology means a robot is going to show up tomorrow that will take over your job or dictate how you will deal with clients.”
While the task force is looking into how technology will best be used with clients, other sessions during the conference dealt with issues such as confidentiality.
“It is important to remember that confidentiality belongs to the client,” said Damienne Lebrun-Reid, Executive Director, Standards & Certification and Head, FP Canada Standards Council.
“The standards of professional responsibility are clear: a certificant cannot assume a client has waived their confidentiality and that prior to sharing confidential information, including the client’s name, a certificant must obtain direct, written consent from the client. Maintaining client confidentiality is a fundamental professional principle and a professional obligation under the Code of Ethics and the Rules of Conduct.”
Lebrun-Reid also reminded financial planners not to disclose any information about any client without express consent.
While many rely on their financial planner, she said not every financial planner knows everything about the industry and speculating or relying on outdated information is not an option.
Multi-disciplinary advising firms
Some multi-disciplinary advising firms have sprung up as a way to provide clients with information that can only come from different professionals, such as lawyers, accountants and insurance advisors.
“We help clients implement the strategies that will help them meet their life goals – meaning we have to almost always call in support from other professionals,” said Julia Chung, Co-Founder & CEO, Spring Planning in Surrey, B.C.
Chung said her multi-disciplinary firm has the skills necessary to attract a dynamic team and bring about a deep, trusting relationship with clients.
She pointed out that when a firm develops a team for a multi-disciplinary approach, each member must have written consent to bring in others and agree on common goals, said Chung.
Clients should also be asked if they are working with others on their financial plan to make sure they are not taking work away from other professionals.
However, if clients are happy with the work being done by a multi-disciplinary firm, Chung said they should tell others.
“The best marketing you can have for your business is to do an amazing job” and get referred to clients’ friends, she said.