We’ve had a few non-UK clients this week ask us about the long-term impact of the RDR on UK advisers’ investment propositions. It’s still evolving, and we cover it in our latest UK Adviser Market report. One of the areas we have looked at is the interplay between advisers’ investment committees and their centralised investment propositions (CIPs).
Around half of firms tell us they run formalised Investment committees, though use varies significantly by firm size. While investment committees are near-ubiquitous in larger firms they are less common in firms with fewer advisers and assets. Their remits vary from those heavily focused on investments to those that are more operational- or compliance-oriented.
We’re also finding an increasing presence of external consultants on investment committees. Research firms are effectively being tapped up to sit on committees. In some cases this is in a semi-official capacity, contributing to debate. In others they are more formally appointed as non-executive chair.
More common than investment committees, Centralised Investment Proposition (CIPs) are used by around two-thirds of adviser firms. Their structure and formality also varies between firms. Some permit their advisers considerable leeway when it comes to going ‘off-piste’ – recommending investments that sit outside the CIP – while others are far more stringent.
We’re predicting increasing use of investment committees and CIPs as advisers further standardise their investment propositions, not least due to PROD placing more formal requirements on oversight/governance.
Let us know if you’d like to find out more about our adviser market research. We’ll shortly be digging deeper into advisers’ retirement propositions, so if you have any burning questions (or strong opinions) please feel free to contact: richard.bradley@platforum.co.uk