The Financial Services Council (FSC) NZ was regaining its sense of purpose after a confidence-sapping couple of years, according to recently-appointed CEO, Richard Klipin.
Klipin, who took over the FSC reins in October last year from interim head, Owen Gill, said the industry body has articulated a “clear vision to be the voice of financial services in New Zealand”.
He said the return of Partners Life, to the fold earlier this month highlighted the renewed industry support for FSC objectives.
“I hope Partners will be the first of several former members to come back,” Klipin said.
The FSC board, chaired by Rob Flanagan, recently signed-off on a new strategic plan focusing on three core objectives: improving consumer outcomes; creating a sustainable financial services sector; and, increasing professionalism and trust in the industry.
Under the FSC plan, the organisation also lists five key target areas including advocacy, promoting “best practice”, and research.
According to Flanagan’s message in the 2016 FSC annual report, 11 “members or associate members of the FSC notified their resignations in the year to October 2015”. In 2016 a handful of other insurer members – including Partners Life, Asteron, AIA and Fidelity – also tendered resignations in the wake of an FSC-funded report on the insurance sector produced by Melville Jessup Weaver. Asteron and Fidelity are currently listed as FSC members.
FSC rules required a 12-month notice period.
“The majority of those members have returned – or remain active in the FSC – by mid-2016,” Flanagan says in the FSC report. “At the date of this report, all of the major insurers, including those that are also banks, remain members of the FSC. A handful of the resignations – from associate members – have taken effect. The resignations were unfortunate.”
Klipin said the FSC retained good support among its traditional member base of insurers, KiwiSaver and superannuation providers but has to date gained little traction with the broader funds management community.
“We are going to engage with the investment funds to better understand their needs,” he said. “Ultimately, all industry associations live or die on their value propositions – members, or potential members, have to see value if they’re going to remain or join.”
Meanwhile, Klipin said talks to formally merge the FSC with Workplace Savings NZ (WSNZ) – which he also heads – were continuing.
“We should have an answer in the next couple of months,” he said. “Now, there’s essentially one secretariat covering both organisations.”
WSNZ closed its Wellington office last year, moving operations to the new FSC headquarters at the ANZ centre in Auckland.
FSC reported a surplus of about $220,000 in the 2015/16 fiscal year on revenue of over $1.3 million (including member subscriptions of about $1.1 million), bringing the total kitty to $250,000.
“Most importantly, we anticipate lower membership revenue in 2017,” the FSC annual report says. “On a conservative forecast, we anticipate members’ revenue at a little over $800,000, a reduction of 28.2% on 2016. This reflects the across-the-board fee cut we implemented for 2017. Effectively, the fee cut returns some of the surplus direct to members, while retaining some of it to fund activities in 2017.”
Prior to taking on the FSC/WSNZ role, the Australian Klipin was head of distribution for the ASB-owned insurer, Sovereign, from November 2015. Previously, he headed the ANZ Australia-owned dealer group Millennium 3 after a seven-year stint running the Association of Financial Advisers – an Australian industry body of mainly insurance-focused advisers.