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Research shows gulf between expectations of wealth managers and clients


A study by SEI has unearthed a striking disconnect between how wealth management clients’ experiences measure up against their expectations. 

It reveals that 100 per cent of private clients responded no when asked whether the wealth management industry was transparent, whilst 100 per cent of wealth management firms interviewed responded yes when asked if transparency is important to rebuild client confidence.

The latest paper is the result of interviews carried out by Scorpio Partnership that compared the views of 25 private clients and 25 wealth management firms on the transparency debate.

The main finding of the research highlights that clients seek openness that focuses on how and why decisions in portfolios have been made, on what basis and how they fit with their goals – i.e. quality of information. Yet what most believe that are sent is a large quantity of siloed, complex information on transactions, fees, tax, products and services. 

However, the paper concludes that in spite of the negative attitude of clients on the topic of transparency, clients are not necessarily expecting a major re-engineering to improve the situation. Rather, they are looking for a change in style, tone and language that would cultivate a transparent relationship.

Joseph P. Ujobai, executive vice president, SEI’s private banks segment, says: "Whilst it is clear from the results of those surveyed that both private clients and wealth managers put transparency high on the agenda, when we look closely at the research, their priorities for how this is achieved are quite different.

"Since the onset of the financial crisis the rules of client engagement have changed. It is therefore important for wealth managers to join the transparency debate as we believe that clients will increasingly demand better information about the products being recommended to them, that which portfolios are being invested in. Wealth managers should ask themselves how they can provide a more dynamic reporting core that offers information and insight and not just data, around which other communications can be better targeted and streamlined."

SEI is a provider of outsourced asset management, investment processing and investment operations solutions.

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