The Gold Standard launch followed the fall-out from the disastrous British Steel pension transfers debacle which many have viewed as tarnishing the financial advice sector. Many British Steel pension scheme members were persuaded to transfer to poor alternatives by predatory financial advice firms.
The Gold Standard was launched in April and is focused on a consumer guide to help the public better understand what to expect from regulated financial advisers when using the Pension Freedoms. It also includes an adviser code of conduct (see below).
The Gold Standard was launched by the PFS’s Pensions Advice Taskforce in April.
The standard and consumer guide have been created by a collaboration between financial advisers, PI insurers, consumer bodies and scheme trustees.
David Bunkle, a partner at Aon, said: “We think that anything which drives adoption of best practice across the advice community and helps pension scheme members to access high quality advice is a good thing.
“It is good to see this initiative taking off and we expect our clients will be keen to note that IFAs have the Gold Standard.”
The guide defines an adviser code which incorporates nine key principles of good practice for when advising on pension transfers.
These nine key principles are:
1. Helping clients understand when advice is appropriate
2. Ensuring advice given supports the client’s overall wellbeing in the context of their stated objectives
3. Ensuring client understanding and acceptance of all charges
4. Ensuring the most appropriate and updated technical skills are applied
5. Transparent management of Conflicts of Interest
6. Helping clients understanding the cost of transferring benefits
7. Avoiding unregulated investments and introducers
8. Transparency in advice processes and outcomes
9. Promoting the Consumer Guide to the Pension Transfer Gold Standard
Keith Richards, chief executive of The Personal Finance Society and chair of the Pension Advice Taskforce, said: “The overwhelming response and support of the Gold Standard represents the professionalism of the majority who are passionate about their profession, but who also recognise that we need to be more united behind the best outcomes for the public, not just the clients who already trust us.”
The Personal Finance Society, part of the Chartered Insurance Institute, runs the Chartered Financial Planner designation in the UK and has 38,000 members.