FoFA: What It Is, What It Means for Australian Recruitment, and How Your Agency Can Profit
Australia’s Future of Financial Advice reforms have given financial advisers several new sets of rules to abide by in order to comply with the law. FoFA, which includes three main pieces of legislation (Client Disclosure, Best Interests Duty, and Conflicted Remuneration), is designed to prevent financial advisers from taking advantage of clients, thus increasing potential clients’ willingness to engage with financial services that they can trust. As a result, this legislation has the potential to be a significant boon to the profit margins of recruitment agencies willing to take appropriate actions.
The FoFA reforms, being a set of new rules imposed upon a specific industry, might be expected to have a dramatically negative impact on financial services businesses. However, though the general demand for financial advice had dropped over the last couple years, a SLICE financial planning survey conducted by The Dawson Partnership and Balance at Work in November 2013 revealed a widespread lack of concern within the financial services industry about FoFA’s impact. Indeed, as the general shroud of uncertainty around the FoFA reforms fades, the demand for financial advisers has already increased as companies renew efforts to chart out growth plans.
In addition to this surge in general financial adviser recruitment, the financial services industry is also seeing increased recruitment demand for workers who specialise in regulation and compliance. The Australian Securities and Investment Commission has put numerous pieces of legislation into effect in the wake of the FoFA reforms, and many companies require assistance dealing with the complexities presented by the web of red tape being strung up around them. As such, these companies are seeking out consultants and financial advisers through contract staffing in order to tighten up their structures for compliance and risk. Truly, neither financial advisers nor the companies that seek out their services seem to be experiencing much negative impact as a result of FoFA. In fact, the FoFA reforms seem to have encouraged both an increased willingness to seek out financial advice and an active pursuit of compliance consultants by both financial advice companies and their clients.
Now that the effects of FoFA on recruitment are out in the open, your recruitment agency can plan accordingly for the newly-regulated future by:
- Targeting candidates in the financial services industry vertical
- Pursuing newly thriving financial advice companies, especially those in need of compliance assistance, as clients
- Directing your recruitment efforts towards contract staffing to take advantage of short-term financial advisory opportunities
- Investing in software designed to handle the particular challenges of contract staffing through back office solutions and access to vendor management systems
An understanding of the way the FoFA reforms have changed the landscape of the financial advice industry can put your agency ahead of the curve. Use this information to power your business through the transition period and come out on top!