Today’s guest commentator is John Porteous, Head of Sales and Distribution at Macquarie. The following views are his personal views and not necessarily those of The Platforum. Thanks to John for his contribution.

Given the fast pace of change across the financial services industry at the moment, it is not hard to find things to talk about. During the past month we have seen some weighty regulatory updates and perhaps even a vision of the shape of things to come across the platform space in relation to open architecture, transparency and choice.

Whilst the FSA’s recent Discussion Paper on platforms generated a lot of discussion in the press, some of the key points of interest were in the accompanying review of platform adoption by advisory firms and the examples of good and poor practice.

On the basis that wrap platforms are a service and not a product, it stands to reason that one of the key drivers of future innovation and development will be the evolution of advice models and the extent to which technology is actually embedded rather than just “utilised”. In that respect, the reaction of the advice market to the Investment advice and platforms thematic review will potentially accelerate change across the entire distribution chain.

There are some very strong messages in the thematic review and I am sure that, for some advisory firms, this will result in a rethink of their existing platform strategy, even if their conclusion is to ‘stay the current course’ for a while longer. Essentially, with the issue of systems and controls at the heart of regulatory thinking, coupled with platform related activity as a supervisory priority going forward, I expect a greater emphasis on the link between platform selection, investment process and desired client outcome.

The real message for me is “Knowing Your Client”. As platform providers we have a responsibility, as well as the opportunity, to enable and support the advice process of the firms that we engage with. Whilst it may seem like a statement of the obvious, the more thought that goes into partnering with the right type of firm for your proposition the better the outcome for all parties. The ability to effectively deliver a one size fits all proposition to market is fundamentally at odds with the concept of being planner led and promoting a collaborative outcome.

So – interesting times ahead. As with many regulatory papers, the implications are not always immediately apparent and the impact will vary from firm to firm. That said, the FSA’s thinking on what constitutes good and poor practice in the advice space may be just as much of a driver to future industry direction as the platform providers reaction to the issues raised in the DP.