A small group of financial advisers has given the industry a bad name.
ONE of the big stories of last week was the issue of phasing out commissions paid to financial advisers.
Financial advisers have got themselves in a real bind in recent years, copping the flak for all manner of collapses. The general perception among consumers is that financial advisers have chased products offering them the highest commission, rather than what was best for their clients.
Perhaps even more damning is the fact that those offering the highest commissions appear to have proved to be the worst investments. In some ways that should be obvious - good investments ought to sell themselves - but the world is more complex than that.
Unlike many in the media, I don't agree with this all-encompassing sentiment. Most advisers are diligent and act in the best interests of their clients, whether they accept commissions or work on fee-based remuneration.
However, there is a fair rump that has let the side down, making a fortune from flogging poor investments to clients whose own greed has often overruled common sense.
The problem today is that all advisers are tarred with the same brush.
In my view that is because they, collectively, have been very poor communicators. As an industry they have been defensive and non-committal on issues that have reverberated on the front pages for more than a decade.
While industry funds have spent a fortune, presumably of their own clients' money, advertising that they don't pay fees, the financial advisers have been missing in action. Other groups of professionals work hard to promote themselves. Accountants are a good example. But financial advisers have largely held back and let industry funds take the high moral ground.
In my view, there are two things they should have been focusing on. Proving they add value - whether they are paid by commission or fees - and distancing themselves from their peers that were doing a bad job.
Clearly they have failed in that respect.
However, all is not lost and the move to phase out commissions, while tortuously difficult, at least brings the momentum back to them.
One of the issues they must highlight is the cost of advice. In this day and age we are increasingly self reliant. The value of doctors, for instance, has been downgraded because too many people think they can solve their health issues by reading up on naturopathic remedies online.
Until a serious health issue comes along, that is.
Unfortunately, serious personal financial problems usually come too late for the adviser to do anything. When you are nearing retirement there is no equivalent of heart surgery.
At the moment, advisers and retail funds are in a serious battle for members with industry funds, which are increasingly purporting to provide advice. That is a very interesting field to contest, because giving advice costs money.
How do industry funds do this more cheaply than independent advisers? And how is advice given by the paid representative of a fund manager any less conflicted than that given by an adviser on commission?
I also really question whether in the longer term industry funds will end up looking any better as investments than their retail cousins.
It is time the premium end of the financial advisory business ditched its less able colleagues in the white shoe brigade and started clearly enunciating how they add value.
Indigenous history
AS the Perth waterfront undergoes yet another virtual reconstruction at the hands of a state government, it is worth considering one of the key elements of this proposed version - a building of national significance that celebrates Australia's Aboriginal history and heritage.
Personally, I think this long-mooted idea is a good one. Many visitors to Western Australia, not to mention local people, struggle to find a central location where they can gain an insight into indigenous culture.
Of all the states, indigenous culture is most obvious in WA, especially outside the major urban centre of Perth.
Hopefully the local indigenous population would support this, not only as an acknowledgement of their culture but also as a strong selling point for our region.
Museums, for want of a better word, celebrating such things can be real drawcards; though they have to be done well, as I discovered a couple of years ago during a visit to the US as part of its generous International Visitors Leadership Program.
I managed to get to two museums of this generic type that would offer lessons for anyone attempting such a thing in WA. These two institutions were the National Museum of the American Indian in Washington, DC, and the National Cowboy Hall of Fame & Western Heritage Center at Oklahoma City.
I'm sure you don't need to be schooled in the nuances of cowboys and indians to see the irony in this selection. The Washington centre was massive and probably required more time than I had to absorb, especially near the end of a day of museum hopping. I felt it failed to connect with me - perhaps because the ideas it was presenting were too big to be taken in quickly. Maybe also it lacked context, being in the middle of the national capital. Maybe it just wasn't aimed at me?
While indigenous culture may be hard to find in downtown Perth, perhaps the relationship with the Swan River would be strong enough to ensure such a project did not look out of place.
By comparison, the cowboy museum I visited was located in a city where people still wore Stetsons in the street - much as the terrific Australian Prospectors and Miners Hall of Fame works very well in Kalgoorlie. The Oklahoma museum was extraordinarily well done. I especially enjoyed the huge galleries with artworks that were the only pictorial representation of the times and conveyed far more than the typical cowboy themes.
In recognising these two US museums, there is one further irony in the fact that the Cowboy Hall of Fame best represented the plight of the mid west's native Americans.
A standout was the massive statue entitled the End of the Trail (pictured), which portrays mass forced migration of native Americans from previously dedicated reserves to the Pacific coast.