As good conduct and business ethics become increasingly important to both regulators and consumers, is it possible to run a financial service that is both an ethical and commercial success?
This question may underpin one of the main issues facing those considering whether to prioritise ethics or success. In reality, the two are not mutually exclusive, and the choice is not a binary one. Focusing on good governance and integrity can actually contribute to your and your company’s financial wellbeing.
All too often, good governance and ethical considerations slip into the background thought process, particularly for individual agents or smaller company directors who bear great workloads and broad responsibilities.
Acting in an ethical way may even feel like an intrinsic part of what you do, and you may not think that it is particularly important to devote further time and resources to these considerations.
The benefits of good governance
Good governance is undoubtedly beneficial for business, and you should not relegate it to a simple compliance requirement or legal tick-box exercise. Establishing an effective structure brings commercial longevity through good practice when it comes to making and implementing decisions.
Even individual financial advisers or smaller companies should set up a formal board. This may seem like a big step, but surrounding yourself with diverse individuals with different skills and experience will challenge and encourage you to consider a wider range of opinions and fresh ideas.
Boards may consist of colleagues, but think about reaching beyond this, especially if you have a smaller operation. Even friends or family can add value. Be honest with yourself about any weaknesses in your skill set and use your board to cover these gaps. For example, if you are not highly interested in social media marketing, then you may want to enlist a family member who loves being online.
Integrity and ethics
Ensure that you always do the right thing for your clients, even if it is not necessarily the best thing for your business. In the long term, fostering excellent relationships and building a reputation for putting client needs ahead of your own will contribute to repeat business, more referrals and a greater brand image to promote through your marketing strategy.
Even in difficult financial times, do not allow the temptation of short-term personal gain for you or your company to override your commitment to your clients’ best interests. These sorts of decisions can come back to haunt you later and have a detrimental impact on your future success.
Recent reports show that trust levels for financial advisers and companies are a genuine cause for concern, and you cannot position yourself to attract new or repeat business if you fall on the wrong side of individual and public opinion.
In the modern digital age, it is easier than ever for you to share your success stories and reach a larger market, but keep in mind that the same holds true for any bad publicity that your practices may generate. By prioritising ethics and integrity, you can ensure your longevity by both managing risk and boosting your overall performance.
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