The Financial Planning Association of Australia's policy lead believes the current AFS licensing regime is standing in the way of financial advisers delivering greater value.
During a discussion about goals-based advice at a recent Advice Intelligence roundtable, FPA head of policy and government relations Ben Marshan said construction of the current licensing regime is hindering advisers' ability to demonstrate value and strengthen client relationships.
"The value of a financial adviser is helping the client define and achieve goals, helping them to trade-off between different goals and keeping them accountable for them. It's not the Statement of Advice or the products; it's the mentoring and the relationship. That's what I think is missing from a lot of advice," he said.
Marshan said if an adviser is individually licensed and individually responsible for the advice they're providing, then a lot of barriers are removed.
"It is then up to them to say 'this is what I need to provide advice, this is how I'm going to do it and these are the tools I'm going to use'...There is no licensee telling the adviser what they can and can't do, how they can and can't do it, and what they can and can't use. That's why it's not working at the moment," Marshan said.
He believes the industry is reaching a tipping point "where the ship is going to turn over and individual financial advisers are going to take control."
"Our message to advisers is it's your advice, it's your client and your relationship and if you're not getting from your licensee what you need to do the absolute best, professional job for your client, then shop around for a new one. Make sure you are getting what you need to help your clients sleep at night," he said.