Six out of 10 investors believe wealth managers do not display the level of empathy needed for them to feel that a true personal relationship exists, a new survey shows.
The survey by SEI reveals that 62% of investors believe the wealth management industry does not deliver empathy, the term used in the survey measure wealth managers’ ability to provide clients with a personal relationship.
Since many wealth managers make a point of describing theirs as a relationship-driven business, the survey indicates the industry falls somewhat short on that measure of service.
The report, “The Relationship Business: Expect the Unexpected,” features in-depth interviews comparing the views of 250 private clients and wealth management providers, including banks, independent trust companies, and investment advisors.
For the report, empathy was defined as listening, understanding, and delivering on clients’ needs. Many of the investors interviewed said the high compensation and bonus-driven culture of the financial services industry makes them believe that wealth managers enter the industry for personal gain rather than to serve the interests of their clients.
SEI concludes that financial institutions can do more to improve these perceptions by focusing more on client-centric processes and working toward systemic change in behavior, culture and ethics industrywide.
The report concludes with recommendations of four best practices for wealth management firms to develop:
-Enhanced client profiling
-Enhanced relationship management skills
-Client-centric compensation policies
Client-centric practices that some wealth management firms are developing include executing in-depth client review meetings and discussions and exhibiting positive behavior and ethics.