He adds that the consumer duty rules may mean more clients are being put into CIPs or model portfolios. This is because it is easier to demonstrate that these products, which can potentially have thousands of clients in them, comply with the duty, largely because they are priced for scale compared to running client portfolios on a bespoke basis.
Fisher says that in the latter case, the onus may be on the investment manager to prove that every individual’s client portfolio is suitable for them and is offering value.
Fisher adds: “The consumer duty has heightened the focus on ensuring that services and products provide good value for end clients. Of course, the challenge comes via the subjective nature of the term ‘value’. Wealth managers and advisers know that all their clients are individuals, and that one size does not necessarily fit all.
"Clients shouldn’t be placed into CIPs en masse just because it is cheaper. Value comes in different forms and a more tailored approach may indeed be what is in the best interests of the client."
Aamina Zafar is a freelance journalist
