Planning for a prosperous future

HAVING spent three days at the Financial Planning Association (FPA) confer-ence in Brisbane last week, it is probably appropriate for me to report on the state of the nation, insofar as financial planners are concerned. At a time when the general mood of the world is one of recession and depression, the financial planners are very much at the coalface of confronting this mood. But if you were present at the conference, you certainly would not have felt that. The industry appears to be in the throes of a substantial boom.

The 2200 delegates from Australia and other parts of the world who converted the Brisbane Convention Centre into their second home for three days were certainly displaying that feeling.

There was considerable attention being paid to a few choice elements of the planning world. Needless to say the two hot topics were the Financial Services Re-form Bill (FSRB) and the privacy legislation. The impact of these pieces of legislation on the way financial planners do their business was an element that received due attention, both in the corridors and the various plenary sessions that were held.

The privacy legislation was seen as something of a sleeper. While the impact was currently limited be-cause of the threshold of $3 million as the required turnover of the business, the presenters emphasised the need for planning firms to

be undertaking an audit of their procedures now. The Act comes into force in December of this year, which does not leave a lot of time to undertake these activities.

Ethical investing appears to be very much the flavour of the day. There are firms now dealing exclusively in the area of ethical invest-

ment. Considerable debate will continue on the issues of ethics that help fund managers and advisers select their stocks. The interesting issue is that, when examining the returns that have flowed to the funds specialising in this area of investment, it can be seen that these have not suffered in any way. In fact, the performances over a long period of time have been quite outstanding. Further, the time that some of these funds have been around gives us valid comparison figures to quote. Some of the larger and more mainstream investment houses appear to have moved into this area of once-specialist investment knowledge.

Stephen Bell, the Global Economist for Deutsche Funds Management, based in London, presented an overview of the world economy. As he sees it, the cuts in interest rates being undertaken by the various central banks, including the once reluctant European central banks, will have the desired effect of stimulating the demand in economies worldwide. The house view of Australia was one of an economy insulated from the problems of the rest of the world, and therefore still able to deliver significant GDP growth rates.

Overall, the conference presented an industry overview of confidence. The planners present took the opportunity to network effectively and, in passing, took on a challenge from one of the keynote speakers, Jose Ramos-Horta, the once exiled East Timorese leader. He ex-pressed the need for dairy farms to be established in East Timor so as to provide milk for the country’s children.

The gala ball on the last day of the conference was converted into a telethon and, by the end of the night, almost $200,000 had been raised. This effectively debunked the commonly held view of financial planners as people with little or no heart.

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