The Financial Services Council (FSC) has released its annual report for 2021, and has recorded a 23% growth in its membership. It also highlighted its merger with the Health Funds Association of New Zealand (HFANZ) on December 01, 2020, which brought the health insurance sector into the FSC.
FSC’s 98 members currently manage funds of more than $95 billion, and pay out claims totalling more than $2.8 billion a year. Members include major insurers in the life and health space, fund managers, insurance advisers, and technology providers in the financial services sector.
CEO Richard Klipin said that the FSC’s purpose is to provide a voice for New Zealand’s financial services industry, and to promote best practice through Codes of Conduct, standards and the regular publication of guidance. The FSC has also been active in providing online events and digital conferences to advisers throughout the past several years, has made 22 submissions on policy consultations, and launched the Get In Shape summits focusing on preparing the advice sector for the FSLAA requirements.
Commenting on the past year, independent chair Rob Flannegan said that it had been a challenging one across the globe, but that the FSC had continued to grow and expand its reach within financial services. This has included releasing a range of research into the shape of New Zealand’s advice sector, and making its first foray into the consumer education space.
“The events over the last year have highlighted new challenges, new opportunities, and have pushed the FSC team to do more and quicker than expected in some areas,” Flannegan said.
“The previous FSC vision was to ‘be the voice of New Zealand’s financial services industry,’ and this served our members well,” he said. “However, the success of the FSC over the last three years has shown that we can and should be bolder.”
“Thus, we have a new vision to ‘grow the financial confidence and wellbeing of New Zealanders’, which better reflects our industry’s aspiration, and the addition of a ‘consumer’ pillar as part of our strategy has been approved,” he said. “We look forward to continuing to develop the FSC over the coming year as we support our members to deliver continuous improvement, and better serve our customers.”
In terms of financial results, Flannegan highlighted that despite the expenses incurred in moving its 2020 conference to a full in-studio digital event, the FSC remained in surplus by the end of the year. Its net assets as of June 30, 2021, were over $970,000, and it is forecasting ongoing growth following the joining of new members throughout 2021/22.
CEO Richard Klipin noted that the past year had been particularly challenging for the adviser sector, and said that the FSC had been rallying to support advisers through lockdowns and regulatory changes throughout the year.
He said that while everyone had experienced the “ups and downs” of lockdowns and compliance changes, the past year had also presented advisers with a great opportunity to re-vamp their businesses - something which would no doubt continue into 2022.
“As with any professional change, there is now a higher mountain to climb,” Klipin said.
“A lot of it has just been around getting our mindset clear around what these changes are designed to do. It’s about better quality advice delivered to more New Zealanders, in a way that’s in their best interests all the time. That’s the challenge.”
“Advisers have been considering the strategic direction of their businesses, and what kind of business they want to run,” he explained.
“Some of those things have been difficult, particularly given the COVID-19 context, which has been really taxing on everyone. But we’ve also seen businesses really embracing the opportunity and flying off the back of it.”
“We’ve gone through a very long and thorough review of the sector, people have had many chances to have their say, and now we’re at the end point of actually implementing it,” he added.
“Business processes and practices are changing, and there’s a lot of opportunity in that - but it is going to be hard work. Advisers have started galvanising around the timeframes and we do need to get cracking, and the FSC is certainly there to help.”
