Since the pandemic struck last year, advisers have been hit with a “double whammy” of changing legislation, and adapting to lockdown - something one leader said has been the biggest challenge for the industry since the GFC.
Commenting on some of the largest industry challenges she’s seen throughout her career, Astute New Zealand CEO Sarah Johnston said that major upheavals in the market are always difficult financially, but also mentally. She said advisers have had a particularly complicated time over the past 18 months, as they’ve rushed to adapt to a demanding new regulatory regime, as well as handling Alert Level 4 lockdowns.
“The GFC was my first really big challenge, and that really turned the market on its head,” Johnston said.
“We lost a lot of advisers during that time because they wanted to go and find paid employment, so that was a really difficult time for them mentally. That was probably the biggest thing I had to deal with in my career, because it wasn’t just the financial aspect which was tough, it was also the emotional side.”
“Then, of course, the changes in legislation coming through, followed by COVID-19,” she continued.
“It’s just a shame that we had those two things happening at exactly the same time, so the advisers have absolutely been double hammered in a lot of respects. They were taking a lot of changes on board, and most of them have really embraced it - but I think that this current lockdown will be a little bit harder for them, because they’re just going through so many things, and they’re now operating in a new regime. They weren’t doing that in the April 2020 lockdown.”
Johnston noted that some Astute members have also had to self-isolate this time around, which has just added on extra pressure.
When it comes to the new regime, she said that advisers have largely embraced the changes - however, they have involved a significant amount of work to prepare for and maintain.
“Whenever something comes along where you have to fundamentally change your business, there will always be those who really stop and embrace it, and a few that we’re going to have to drag along with us,” Johnston said.
“We’re pretty fortunate in that the latter has been quite the minority, and generally it’s not because they don’t want to - they just haven’t taken the time to stop and think about how to adopt the new changes into their business practice.”
“But they all understand why it’s needed, and we haven’t had anyone disagree with any of the principles around why it’s required,” she added.
“It’s just been about changing some business practices, and learning how to do things that they hadn’t really done before like scopes of service, or statements of advice. They’ve needed to work out how they can fit that into their businesses without having to do too much more administration.”
