The FCA’s current emphasis on risk and suitability was firmly established in the key guidance consultation paper FCA GC 11.01 (2011): Assessing suitability: Establishing the risk a customer is willing and able to take and making suitable investment selection.
Research’s role is unequivocally set out in the Financial Conduct Authority’s (FCA) Thematic Review document1 as defining the difference between good and bad advice. It puts suitability at the centre of advice and, by extension, advisers’ key contribution. There are too many emotional facets, compromises and complexities in advice for it to be automated any time soon, but research can and should be automated.
Regulatory initiatives, including the Retail Distribution Review (2012), have promoted a client-centred, holistic approach to financial advice, moving it further into goal-based financial planning territory and away from the emphasis on product-pushing that existed at a time when behemoth providers and commission dominated the financial services industry.