With many people still cautious about making financial planning choices, never before has so much attention been directed at Hong Kong's wealth management industry as in the past year. As regulators keep a close watch on industry practitioners, compliance and understanding regulations have become increasingly important to all financial planning providers, large and small.
Carrie Leung Ka-lai, chief executive of the Hong Kong Institute of Bankers, said in view of the changing banking landscape, the importance of continuous professional development and education had gained increasing attention. Leung believes tougher compliance regulations, closer internal monitoring and higher professional standards will lead to new opportunities for financial planners.
Companies operating as independent financial advisers say new regulations have provided many wealth management practitioners with a chance to focus on upholding and improving professional industry standards.
For instance, at Convoy Financial Services, stringent compliance requirements are not only in place to protect the client, they are also in place to protect the financial adviser.
"When someone joins Convoy we point out we are not just helping them with their career path within the company, we are helping them build a career path within the industry," said Rosetta Fong Sut-sam, chief executive officer at Convoy Financial Services. She said those who failed to take compliance and regulation issues seriously were required to complete additional training until they met the company's stringent standards. According to Fong, the negative publicity arising from regulatory action, reprimands, fines and other public sanctions inevitably damages a firm's reputation, which leads to loss of investor confidence and clients. Failure to comply with regulations could also mean the end of an adviser's career.
Conversely, those who strive to go beyond compliance requirements and provide suitable products and investment advice earn their clients' trust and confidence. In addition, investment advisory firms that have built up a good reputation will more easily attract talented staff.
"For some time our goal has been to operate our compliance and regulation standards above those required by the various regulatory bodies," Fong said.
Compliance initiatives include an in-house legal and compliance department to mo