Demand for interpersonal skills such as communication and empathy is outweighing technical expertise and investment returns among clients of “trusted advisers”, according to the latest Association of Financial Advisers white paper.
According to the white paper – which is based on research conducted by the Beddoes Institute in association with the AFA and Zurich – 82 per cent of clients surveyed indicated “interpersonal skills” were the quality they most valued in their adviser, followed by “professional reputation” (19 per cent) and “quality information” (17 per cent).
Only 4 per cent of the 500-plus clients surveyed indicated “technical skills/expertise” was the most valuable quality.
Expanding on the results, Dr Rebecca Sheils, a psychologist at the Beddoes Institute, said that while technical ability and helping to achieve financial outcomes are important for clients, interpersonal skills were the “differentiator” for the most “trusted advisers”.
“Academic qualifications and technical proficiency on their own will never be enough to build sustainable relationships with clients,” Sheils said. “[The white paper] demonstrates that the way an adviser interacts with the client and the development of a relationship with them are more influential in developing trust.”
However, the sample was made up of clients of 13 practices that have previously ranked highly in the AFA Adviser of the Year awards competition, and Sheils said that the findings are therefore not necessarily reflective of the wider industry.
Though unable to provide specific figures, Sheils said the number of clients of practices outside the 13 Adviser of the Year businesses who listed “interpersonal skills” as the most valuable attribute was “significantly lower”.
Sheils said that while it is possible for advisers to improve their emotional intelligence quota (EQ), providing training on these ‘soft skills’ is one of the “biggest challenges facing the [financial advice] profession”.
Commenting on the findings, AFA chief executive Brad Fox said that industry associations, as well as financial services licensees and practice principals need to invest more in EQ training.
“We need to be looking at EQ competencies as well as technical,” he said. “The implications for the industry are around recruiting; a key question is whether those businesses that are recruiting at the moment are looking at the EQ of the prospective candidates.
“[Dealer groups] need to help them their advisers in EQ rather than talking about the latest product innovation, or in addition to that.”
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