A Sacred Trust

My sister, Robin Sweeny, saw Dan Wheeler speak many years ago and this stuck in her memory. She reminded me of it recently and said I should write about it to communicate how we see the advisor/client relationship. Dan calls it "A Sacred Trust." The industry has suffered a poor reputation for so long, I feel, because this is never made clear to prospective employees much less to the investing public. Unfortunately, the reason many young people originally got into this business was to make a lot of money. The fact that you potentially get to make a positive impact on people's lives never entered the equation. The running joke when I was interviewing on Wall Street in the early 80's was just say that you were "hungry" to the interviewer to score points.

One way I try to educate our interns and college students I address these days is by telling them that this is a business where you can make a positive contribution; a huge impact on the lives people will lead in the future. If the client relationship is approached with this mindset, they will see the passion advisors bring to the relationship. They will feel the advocacy, and quite frankly, they will appreciate the value. Several studies have shown that what advisors think is important isn't important to investors.  Advisors who portray themselves as portfolio managers, investment gurus of some type, often fail to embrace this Sacred Trust. They miss the opportunity to demonstrate to the client how they advocate, educate, and bring value to the lives of their client. The value is in the level of client service you bring, and the quality of advice you offer. It's in the questions you ask that are not necessarily investment related. 
So how do we as an industry address this? One way is through higher barriers to entry - make a professional designation a requirement before you are allowed to make recommendations to investors. I think the Certified Financial Planner designation is a good start. Designations bestowed by brokerage firms should be disallowed; conflicts abound. Independent third parties that meet a minimum accreditation should be the only entities allowed to certify professionals. Continuing education should be mandatory. This is all necessary to raise the level of financial advisor from an occupation to a true profession.

Investors have the right to feel they've placed their trust in someone who places the investor's interests before their own. They have the right to know that their advisor has completed a rigorous curriculum of professional requirements that qualifies them to give advice. They have a right to an advocate; nothing less.