Financial advice to remain ‘cornerstone’ of AMP

In its annual report, AMP said that financial advice plays an important role in the lives of Australians, helping them to plan and reach their life goals, and it “remains a cornerstone” of the group.

While commissioner Hayne did not recommend that vertically integrated wealth models like those of AMP and IOOF be dismantled, it was recommended that advisers must declare their independence or lack of independence to clients.

The major banks have all decided to divest of their wealth businesses to varying degrees. For some banks, this is proving to be more difficult.

AMP said it has been transforming its financial advice business and will continue this in 2019.

“A core component in transforming advice is the Advice Improvement Program, which was accelerated in 2018 to meet changing regulatory and consumer expectations,” the group said.

“This program has been focused on ensuring our advice business is meeting contemporary standards, commercial best practice and giving advised clients confidence that their adviser is providing advice in their best interests.

“The program covers both employed and aligned advisers. We are working with ASIC to deliver its regulatory changes and throughout 2018, significant progress was made in rolling out new standards in advice policies, processes and the monitoring of the implemented changes. AMP is committed to achieving and exceeding high standards of professionalism and ethics in financial advice.”

In 2018, AMP launched Adviser Pathways, an adviser training and development program for those new to the industry to meet the growing demand for high quality financial advisers.

AMP has also expressed its support for the objectives of the Financial Adviser Standards and Ethics Authority (FASEA) and provided seed funding and made submissions on its new FASEA standards for advisers.

In December 2018, AMP announced the appointment of Alex Wade as group executive for advice to design and implement a strategy for transforming its advice network to meet consumer and regulatory expectations.