Expert: David Imison, Schillings
Facilitator: Annie Catchpole
The collective brand and reputation of the Wealth Management industry is often misunderstood, misrepresented (by the press) and undervalued. Therefore, how can individual brands defend themselves against reputation damage, and what steps must employees take to protect their company’s reputation? Defining brand values, hiring the right talent, and strengthening the client experience are all key.
- The financial industry is still nursing the wounds of the global financial crash and now must react to recent reputational threats including cyber-attacks and the Panama Papers.
- Public perception and trust in the financial industry has been hit hard in recent years, and the press has focused heavily on the challenges faced by the industry and its professionals.
- Managing client expectations today means balancing the regulatory sea change and client requests of data and privacy.
- Defining brand values and hiring the right talent to help express those values through a collective voice is requisite.
- Improving client engagement and service is the bedrock measure needed to build and rebuild consumer and public trust.
Although few industries were left unscathed by the 2008 global financial crisis, the public’s faith in the financial sector was especially damaged, making professionals in the industry ‘easy targets’.
More recently, financial brands and reputations have once again been shaken– with cyber-attacks, fake news, the Panama Papers, rogue employees, and regulatory slip ups taking up the front page of newspapers and media sources across the world.
There has undoubtedly been a shift in societal expectations and public perception of the financial industry as a result.
In a recent report, CityUK highlighted the important role financial and related professional services play in supporting jobs and growth agenda, employing over 7% of the UK workforce and producing nearly 12% of total economic output.
Yet despite the economic contribution and professional opportunity, delegates felt that the press continuously misrepresents the direction, ambition and integrity of companies working within the financial realm – often adopting a broad brush approach based purely on large-scale dilemmas. This has placed the industry and the various brands within in at the very bottom of the reputation heap.
Many individuals in the session expressed they often hear stereotypes comparing all those working in the financial industry to ‘greedy and untrustworthy bankers’ (despite the varying sectors such as insurance, wealth management, asset management, etc.). They have heard that the public perceives financial institutions to be scheming, working with governments to alter policies so as to safeguard the wealthy:
“There is a certain animosity that society has towards the elite, and those who earn a lot of money. The press covers this a lot, because it fits their narrative. We are commodities in the hands of politicians, which can sustain their strategies. But they never mention the good things we do. That never gets into the papers.”
Firms across the board have reacted differently to this type of negative brand news. One individual in the session explained he sensed a relative ‘paranoia’ infiltrating itself into his company. So much so that an unwritten mantra is becoming engrained in employees’ minds – anything they write down or say could end up on the front of the Financial Times. They think this in order to be increasingly aware of what they do and say.
“Reputation – it is easy to lose, but very hard to gain.”
Other delegates confirmed the absolute necessity for the financial industry to break out of their old- fashioned chains, and apply fresh thinking to how they develop themselves and their brands. They recognise that whilst often times the reasons behind poor business reputation may be unfounded, every individual firm must do their fair bit to mitigate the extent of such comments.
The roundtable was then asked - have the millions that have been spent on brand re-launches, detailed customer care initiatives, and strategically driven value propositions achieved their desired effects? Delegates claimed that while the public continues to respond with a general shrug of the shoulders when discussing financial institutions, this is not necessarily the same reaction they receive from actual clients they work with.
Ultimately, the management of their HNW clients’ expectations in these times of reputational upheaval must be dealt with carefully. Why? Because advising clients whilst taking into account transparency and privacy requires a delicate balancing act.
Delegates were also quick to note that this balancing act can easily turn into a catch 22 – the added dimension of human emotion that plays into the protracted litigation between regulations and what clients want can lead to frustration. Because whilst clients want their advisors to be increasingly sensitive with the personal data they handle, those advisors must be wary of the flexibility with which they handle this information because private data has become extremely valuable to journalists and cyber-criminals.
As a result, the roundtable agreed that improving customer service was the most important measure in cultivating or re-building a positive reputation for individual firms, but for the industry more widely, especially because clients place much more trust in the advisor they work with than the institution.
In fact, an individual who had worked in a large investment management firm in 2008 stated that following the crash, the firm conducted a client survey. Results showed that whilst client perception of the brand decreased drastically, the levels of trust clients had in their advisors remained the same.
Whilst rebranding can create opportunities to redefine brand values and re-educate staff to adopt new working methods, it is the consistency maintained at the face-to-face levels of client engagement and excellence that allows particular companies to thrive.
The discussion concluded by highlighting the three key steps financial institutions can take to protect their company’s reputation and brand:
- Defining brand values and working to deliver values expressed through a collective voice
- Many financial institutions have fallen into the trap of looking and sounding the same (in brand messaging, website tone, proposition statements). Firms must strive to understand the specific areas in which they want to differentiate, and this can often be accomplished through fine-tuning brand values.
Do not overshoot. Expanding their reach and spreading themselves too thin exposes firms to reputation damage. Businesses should stick to what they are good at, and refine the value propositions linked to their successful business models.
- Hiring the right talent and educating the workforce to carry out brand’s ambitions
- Disasters can be averted if expertise is made available – appropriate and robust strategic decisions are those which have been analysed and tested from all angles. But if people don’t know enough, they will not challenge situations they are unsure of. And if they don’t challenge it can perpetuate into a bigger problem. Hiring the right talent and filling any gaps in the organisation is critical to bullet-proofing institutions.
- Bringing brand value to the client experience
- The human factor undisputedly can act as the winning streak. Building relationships with clients can last the test of time (and of fluctuating markets).
- Abiding by regulations whilst ensuring clients that their data is safe and will remain private can be achieved by implementing encrypted communication software.