The Investment Funds Institute of Canada’s new chairman, Charles Sims, is calling for greater public understanding and recognition of the value of financial advice.

Speaking at IFIC’s annual conference in Toronto on Friday, Sims, who is president and CEO of Mackenzie Financial, said that IFIC’s top objective for 2011 is to continue to demonstrate the value of financial advice and the mutual fund value proposition.

“Public discussion on policies affecting our industry are too often distracted or misinformed about the cost of the mutual fund product, without any understanding or recognition of the embedded services that these products provide,” he said. “Advice and distribution are key components that have been continuously overlooked.”

Sims argued that advisors play a major role in delivering the government’s policy decisions related to public retirement savings. He noted that advisors provide “complex services” that must be catered to each client’s unique financial situation, risk tolerance, investment goals, life cycle needs and timeframe.

“Most Canadians find that they lack the financial knowledge, the discipline to stay on top of the program, or the time required to conduct the research of the various options available to meet their needs,” Sims said. “It is not surprising that Canadians overwhelmingly choose advice over non-advice in making their financial and life decisions.”

The debate on the cost of mutual funds in Canada often fails to account for the value of advice, according to Sims.

“Must of the analysis is based on research that uses straight expense ratio comparisons, which doesn’t tell the full story about the total cost of ownership when an investor is using the advice model versus non advice methods of distribution and product packaging in other countries,” he said.

He noted that in Canada, investors purchase mutual funds through advisors up to 85% of the time.

“When appropriate adjustments are made for differences between Canada and the U.S., the total cost of owning mutual funds bought through a financial advisor between the two countries is comparable across different asset class categories,” Sims said.

Other objectives for IFIC next year include participating in the policy discussion related to Canada’s retirement system, tax policy review related to the new Harmonized Sales Tax in Ontario and B.C., strengthening dialogue with government and regulators, and enhancing financial literacy.

“Without a general level of financial literacy and the knowledge that financial advice is readily available and affordable in Canada, individuals run the risk of making poor choices,” Sims said.

As part of IFIC’s efforts in enhancing financial literacy, he said the institute would work with the Canadian government’s Task Force on Financial Literacy to endorse the provision of financial advice. Investors must learn how to find the right financial advisor, what to expect, and how to have an effective partnership with their advisor, he said.

Sims called on the industry to contribute to raising awareness of the benefits of advice.

“We need to continue to ensure that the value of the industry and the positive role we play, both in the lives of individual Canadians as well as in the economy as a whole is understood,” he said.

IE