AMP Financial Services is looking to further industrialise its advice process in an effort to raise the productivity of its financial planners.
"The productivity of a financial planner has been going down as the legislative requirements around providing financial advice got more complex," AMP Financial Services managing director Craig Meller said yesterday.
"I'm not saying that is wrong; you want quality standards. But I don't think the industry has been very good at industrialising the process of achieving those standards. Within Axa and AMP that has been an ongoing development," Meller said.
Meller argued that the financial planning industry in Australia was still too bureaucratic and relied still too much on paper forms.
"Our challenge as the biggest player in the market is to improve the efficiency of planners, which essentially means: 'How do we improve the amount of time they have available to see clients, rather than doing their paper work?'," he said.
Meller said AMP did not support the Government's proposal to introduce an annual opt-in requirement for financial planners, because it just created more bureaucracy and costs, and would detract from achieving efficiencies.
"We don't think it is strictly necessary, considering the fiduciary duty," he said. "It's creating rules for rules sake rather than creating an underlying logic to it.
"One of the ironies of the financial crisis is that if you were to believe some people the only model that should work is an independent advice model with a fee-for-service relationship.
"If you look at Storm that was an independent financial adviser model with a fee-for-service relationship. I'm not sure that is the solution. Bad advice is just bad advice."
The merger with Axa Asia-Pacific's Australian and New Zealand business has given AMP a distribution network of about 3000 financial planners, making it by far the largest advice business in Australia.
AMP will maintain the Charter Financial Planning and Genesys Wealth Advisers brands, but will have to part with the Axa brand, which is owned by the French parent, Axa SA.
"We are already talking with those planners whether they prefer AMP or a new brand," Meller said.
"Do they want to switch into the Charter proposition, which is very similar? That is something we will be working through over the next couple of years and we will be guided by their decision."
Meller also indicated there would be scope for graduates of its Horizon academy to join the Axa planning businesses.
"We haven't made any final decisions there, but the expectation is that one of the real benefits there will be for the businesses on the Axa side is that they would get access to that sort of capability," Meller said.
"High on our list is whether we should increase our Horizon's intake. At the moment, we do four or five intakes a year of 30 to 35 people and we have 800 applications for each intake, so there isn't really a shortage of applicants, it is our capacity to grow that."
