Compliance, From the Client’s Perspective

Does the word “compliance” send chills down your spine? I get the sense that “compliance” is still seen as this thing that makes, what would otherwise be a rather engaging experience between advisor and client, become a bureaucratic series of forms, signatures and fine print. And I think that to a large degree, that’s still true, since Compliance is a function, mostly managed separately from other areas in the business, not too dissimilar from IT, HR or Finance. The consequence of having it in a silo is that it becomes this thing that sits “outside” everything else in the client engagement process – a distinct “process for compliance,” rather than a, “single process that is compliant.” 

I think that there is lots of value in the stuff that our Regulator puts out to the market to help manage our relationships with clients. I like to think of these pieces of regulation as valuable input from our clients – information which gives us insight into what our clients need from us. Listening to the Regulations, in my role as a Compliance Officer though, I am probably going to hear something like, “We need a legal document titled Record of Advice. Plus it needs lots of fine print.” Or maybe, “We need another legal document titled Disclosure Document. Also, with lots of fine print.” 

There is though, another perspective that we could use to understand what the Regulator is offering up to us. Listening to the Regulator as the “Guardian of the client value proposition,” I’d expect we’d hear something quite different. I expect for example, that we’d pick up on the insight that clients like to understand the reasons for the recommendations that we make and having them available as a reminder for when they’ve forgotten, would also be helpful. That’s going to take us to a very different place in terms of what we stick in front of the client. The second perspective, creates space for the client need to be met in a way that is meaningful and enjoyable for the client. It will probably manifest in the engagement process very differently to a fine print legal document … maybe a different planning tool, a facebook post, a playful sound bite, a personalised comic strip, a youtube video. Who knows what innovative stuff we can come up with in the context of “building it as part of a pleasurable experience for the client.”

Getting back to “building (an awesome) Advice Process that is also compliant,” we need to think carefully about the stuff we do for “Compliance” from the outside-in. In other words, let’s start from the client’s perspective, not Compliance’s, to decide what we put in front of the client to meet Regulations. If we take the view that the regulations help us understand what clients need after all, we can start meeting these needs as a core part of our offering to them, not a sideline document that we pretext with, “Agg, Compliance makes us do all this stuff, it’s nothing important, just sign here.” 

To do this, we need to partner closely with our Compliance colleagues, collaborating together on one process that is the overarching experience that the client walks away with. There is no “relationship” which is separate from the “compliance process.” There is only one experience and we have to come together to make it an awesome one.

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