Adviser Ratings sharpens ratings

Adviser Ratings is reforming its scoring system; as a result of which, one-third of advisers can expect to have their badge downgraded.   

The independent financial adviser ratings agency will now incorporate qualifications, relevant association memberships, experience and the volume of consumer reviews in its ratings for advisers.

Commenting on the changes, founder Angus Woods said the new scoring system is squarely in line with the industry’s professional evolution.

“Consumers are increasingly demanding transparency from advisers about their education, professional commitments and experience, but it’s still hard to access that information in one place,” Mr Woods said.
 
“While ASIC’s Financial Advisers Register (FAR) lists some professional information, our analysis has shown an alarming number of advisers have out-of-date listings about their association memberships.”

According to Adviser Ratings, 9 per cent of advisers who said they were members of the Financial Planning Association were not current members, while 13 per cent of listed SMSF Association members did not have an active membership.

“The Hayne royal commission showed all Australians how important trust is in financial advice, but unfortunately, not all advisers are giving consumers an accurate picture of their professional memberships,” Mr Woods said.

He noted that advisers wanting to improve their ratings have a number of available options including completing a FASEA-required qualification, joining a “tier one” professional association, completing CPD requirements and encouraging clients to leave a rating.