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There is much that brokerages need to focus on today to support advisors to deliver the best possible service to their clients, from corporate culture and diversity and inclusion to training, technology and compliance. To find out which brokerages have achieved the ideal combination of all of these aspects, Wealth Professional turned to its network of individuals and organizations within the Canadian wealth management landscape, surveying more than 1,700 financial advisors and wealth management professionals to find out their opinions of the brokerages they work with.
Ultimately, 15 firms earned the title of 5-Star Brokerage in the first in a series of 5-Star Award special reports WP will be publishing this year to recognize great individuals and organizations in Canadian wealth management. Advisors also weighed in on the areas where their firms are excelling and where they still need to improve.
Overall, brokerages’ top-scoring category was corporate culture and ethics; advisors gave their firms an overall score of 96% in this area. In addition, 89% of the advisors surveyed said they thought their firm was doing an excellent job of building culture.
Those trends were also affirmed by the qualitative research WP conducted – among the positive comments advisors made were that their firm puts clients’ needs first, that they felt their opinions were valued by leaders and that their organization has solid leadership.
One firm that received consistently positive feedback from advisors on its culture was Wellington-Altus Private Wealth.
“Culture is a bit of a buzzword, but at Wellington, culture is what we are all about,” says Charlie Spiring, founder, senior investment advisor and chairman of Wellington-Altus Holdings. “We focus every day on how to improve our culture. We do it through connection – there are multiple ways, but we do a monthly connect call where we speak to our world, talking about what’s going on with all aspects of the business. Our management is so connected with our advisors, the gap is near zero. Management has ingrained a listening attitude to our advisors. Management listens well – we insist on listening even when we are wrong. We’ll tell [advisors] when we are wrong, when they are right and adapt. That adaptation is a massive skill we have overlaid on our model.”
Another area where brokerages scored highly overall (94.3%) was technology. It’s another hot-button topic for advisors, especially those at larger firms, where use of the firm’s tech tools is usually mandated. That makes it even more important for firms to listen to the needs of their advisors so they can supply the best possible tools. Many of the advisors WP surveyed said they’re happy with the tools they have access to; however, there were some who wanted to see improvements.
Jim Durnin, a senior financial planner at 5-Star Brokerage Assante Financial Management, says incorporating technology can help advisors establish both discipline and consistency.
“Where I see technology helping us is to become more disciplined, more consistent and to provide longevity in something you are creating,” Durnin says. “On the discipline side, when we have signifi-cant geopolitical events or a recession, emotions play a large role in the investment process. Having some kind of baseline you can refer-ence when making decisions is important. [Technology] can help us during periods of high stress.
“For consistency, in the 1990s, I used to find I would structure a portfolio differently depending on the day or week I was having. What I wanted to do was make the experience of our clients very consistent, and so a computerized investment process helps accomplish that.”
There’s no doubt that one of the most important things brokerages need to focus on right now is diversity and inclusion. Overall, brokerages earned an impressive score in this area (93.7%); however, only 78% of firms received an ‘excellent’ rating from advisors for their efforts toward making wealth management a more diverse and welcoming industry.
It’s an issue that many firms are aware of and are starting to take action on. Canaccord Genuity Wealth Management, for example, has been making sure its hiring, training and succession planning processes all provide equal opportunities.
“Diversity and inclusion is definitely a focus for our firm,” says Stuart Raftus, vice-president and chief administrative officer at Canaccord Genuity Wealth Management. “The whole industry, for a number of years, lacked that, but I think the industry is doing a better job today. It has been an industry dominated by white males, frankly, for a number of years, so you have to be cognizant of what your communications in the marketplace are and what mediums you are using so you reach a broader group.”
Brokerages’ compliance efforts received the second highest overall score from advisors (95.9%), and 87% of advisors rated their firms ‘excellent’ in compliance – suggesting that advisors understand the importance of the compliance measures their firms put in place.
Some firms have found that compliance success lies in creating a partnership between advisors and the compliance department.
“We take a common-sense approach,” says Shaun Hauser, founder and president of Wellington-Altus Private Wealth. “We try to always do what is best for the client, company and advisors, in that order, and make sure the client is being taken care of. If there are mistakes that need to be corrected, we correct them. It is very important our advisors view our compliance department as partners, not as adversaries. The term ‘dictatorial’ does not come into our lexicon on how compliance manages and helps us understand our risks. I believe our advisors really appreciate that and would tell you our compliance department is an asset, not a detriment.”
According to the advisors WP surveyed, the area brokerages need to pay the most attention to is training. The category had the lowest overall score (90.2%), and only 69% of advisors rated their firms ‘excellent’ in this area – and nearly 5% rated their firm’s training as ‘poor.’
At Edward Jones, the key to training is providing opportunities at all stages of an advisor’s career, says Katrine Clark, the firm’s principal of branch team talent acquisition.
“Training is not just something one needs to close the immediate gap and complete a specific job requirement; we take a career-long view in developing talent,” Clark says. “We continue to develop programs for branch teams to prepare them for the next step in their progress. We also provide tailored onboarding support for financial advisors transitioning to Edward Jones and leadership training and coaching for those showing a passion for developing talent.”
Even with the areas that need improvement, the findings of the inaugural 5-Star Brokerages awards indicate that advisors are generally pleased with how their firms are handling key areas of support. That’s a positive for the wealth management industry as a whole – and for the millions of Canadians relying on advisors for financial guidance.
Wealth Professional’s inaugural 5-Star Brokerages awards celebrate the firms that are excelling in key areas like culture, compliance, training andtechnology. The awards give advisors who might be contemplating moving their practice insight into the industry’s highest-rated brokerages.
During a 15-week process, WP’s research team conducted one-on-one interviews with advisors from top brokerages across Canada and surveyed thousands more within WP’s national audience to gain a keen understanding of what advisors care most about in their relationships with their firms. Advisors were first quizzed on what features of a brokerage matter most to them and then asked how their brokerage ranked on each of those attributes.
From those results, WP’s research team created a shortlist of finalists. To be eligible, each firm had to be a full-service brokerage with a minimum of three locations. From there, the research team conducted further in-depth telephone interviews with advisors to capture qualitative data to validate the results. Based on the importance of each criteria, WP applied an algorithm to determine the star rating of each firm in each category. The firms that received the highest ratings across all criteria were selected for the final list of 5-Star Brokerages.