A survey reveals that more than 80 per cent of advisers have welcomed the best interests duty since its introduction in 2013, believing it was necessary to raise standards across the industry.
The research from HUB24 found that two-thirds of the advisers surveyed agree or strongly agree that the best interests duty has led to better outcomes for clients.
In addition, more than half disagree that the best interests duty is just further red tape and compliance for no real benefit, while almost four out of five disagree or strongly disagree that it is a waste of advisers’ time and money.
“Whatever advisers may have thought about the best interests duty and the attendant compliance burden before it was introduced, adviser responses suggest there is now broad acceptance that it was both necessary, has led to better results for clients, and that it does not represent regulation for regulation’s sake, and it is not a waste of time and money,” the research said.
HUB24 managing director Andrew Alcock said that, at a time when there is increasing scrutiny on the quality of financial advice, it’s very clear from this research that advisers are focused on meeting the best interests of their clients.
“In our experience, advisers have always considered a range of factors, and not just price, when selecting financial products to help deliver outcomes for their clients both now and for the future,” Mr Alcock said.
The chief executive of the Association of Financial Advisers, Philip Kewin, said the best interests duty is “arguably the most important obligation for financial advisers”.
“We would encourage more research being done in this space and more guidance provided to financial advisers to ensure that they can be confident that they are meeting their obligations,” Mr Kewin said.
“Ultimately an increased awareness of the best interests duty and related obligations will result in improved outcomes for the consumers of financial advice.”
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