Adviser Study Claims Industry-First Benchmark for ‘Know Your Client’ Behaviours 


The international financial advice community has benchmarked for the first time the extent to which financial advisers know and understand their clients, a new study has found.

Financial advisers and financial planners engaging in leading ‘know your client’ behaviours see 72 percent higher net client growth and 56 percent more of their clients are eager to recommend their business to family and friends, the study found.

Over 300 client-facing advisers from Australia, New Zealand and the US participated in the survey between July–September, 2018.

The survey questions aimed to identify the specific behavioural building blocks advice professionals can and should engage in to know their clients, spanning foundational to advanced behaviours and techniques.

The study was supported by an international coalition, which included:

  • Financial Advice New Zealand
  • Association of Financial Advisers (Australia)
  • Portfolio Construction Forum (Australia & New Zealand)
  • Financial Planning Association (USA)
  • Berkeley Executive Education (USA)
  • Capital Preferences (USA & New Zealand)
  • T. Rowe Price (USA, Australia & New Zealand)
Financial Advice NZ CEO, Katrina Shanks

Financial Advice New Zealand CEO, Katrina Shanks, says the landmark study provides advisers with an answer to the question ‘what does it mean to know your client?’.

“For the first time, advisers have a benchmark across practices in USA, New Zealand and Australia.”

“For the first time, advisers have a benchmark across practices in USA, New Zealand and Australia,” said Shanks. “The data and findings released over the next six months will be an indispensable tool for firms who seek to grow their business and advice professionals who are serious about taking their client experience to the next level.”

The study also found:

  • Advisers find more personal fulfilment from deeply understanding their clients
  • The ‘behaviouralist’ adviser has emerged – those advisers that use new tools and technology to focus deeply on clients’ actual behaviors, not just what clients report or say. The study found that this segment of advisers see significantly higher client willingness to recommend, double the referral rates and nearly triple the net client growth rate compared to other advisers.
  • That highly proficient ‘know-your-client’ advisers spend more time directly engaging with family of their client (partners and adult children) and  are 40 percent more likely to discuss aging-related lifestyle transitions, as well as cognitive decline, with their clients and their families.
Portfolio Construction Forum Managing Partner and Dean, Graham Rich

Portfolio Construction Forum Managing Partner and Dean, Graham Rich, says ‘know your client’ is one of the foundations of financial advice.

“Yet there is surprisingly little measurement – and certainly no industry benchmark – for how well financial advisers really know their clients. Until now,” he said. “Continuing to scientifically explore attitudes and behaviours around people and money is critical to delivering quality financial advice outcomes, so the Forum is delighted to actively support this ongoing study.”

The benchmarking survey has been re-opened until November 15 to provide other financial professionals an opportunity to benchmark their client understanding practices against those of their peers.

Click here to participate in the 20 minute survey.