Reg Jackson and Paul Manders believe that what sets their advisory team apart is its commitment to finding and implementing industry best practices. And a key element of that is consulting with the team’s client advisory board.

“Any major decision on how we operate,” says Manders, “is vetted through our advisory board first.”

Jackson and Manders — along with David Plumb — are partners in London, Ont.-based Plumbline Wealth Management, a six-person team that operates under the National Bank Financial Ltd. banner. In April, the two spoke at the Top Advisor Summit in Toronto. Jackson and Manders, lifelong friends who grew up in the London area, manage or co-manage assets of $350 million.

The eight-member CAB meets twice a year, in May and November. At each meeting, members discuss a specific issue affecting Plumbline’s business. Recent topics have included how the advisors can best communicate with their clients, whether a certain marketing initiative would be useful and how best to structure client appreciation events.

As a result of CAB meetings, Plumbline has made changes to its operations. For example, the partners discovered that clients weren’t reading the firm’s quarterly newsletters — an expensive and time-consuming project. They decided to stop publishing regular newsletters and publish only when events warrant it.

Plumbline’s CAB meetings are held in the early evening and usually last 60 to 90 minutes. Afterward, there’s a cocktail hour and dinner for board members and their spouses. The May meetings are held at a local country inn, and the November meetings at a local golf course. The cost of a meeting runs between $700 and $1,200. In addition, Plumbline rewards CAB members by absorbing their RRSP administration fees.

The perks seem to be more than enough, says Manders, because clients participate willingly; they appreciate the opportunity to have input into the way Plumbline operates. “They get value out of having an effect on our business, and having a say in how their accounts will be managed,” he adds. “It also gives them a better understanding of how we operate.”

When the first Plumbline CAB was formed four years ago, it consisted of seven clients and two non-client centres of influence. The client portion of the board represented a cross-section of the firm’s client base, including younger and older members, male and female, and clients with transaction-based accounts and fee-based accounts.

Board members were asked to make a commitment of at least one year. All but one of those members are still on the board (the one left for family reasons). In the years since, the two non-clients have become clients of Plumbline — even though that was not the intention when they were asked to join.

Manders and Jackson recommend that advisors starting a CAB invite non-client centres of influence such as accountants or lawyers to join, because they represent important business relationships and can provide a fresh perspective.

“Non-client centres of influence often work with other advisors and can provide input in terms of what they are doing,” Jackson says. “So, we can pick up on best practices.”

Manders and Jackson say almost any topic, except for market-based decisions, is up for discussion. This includes how Plumbline charges its clients for its services.

“Our board wouldn’t be successful unless we talked about these topics,” Manders says. “It’s a risk [to talk about fees]. But we find that when we have taken these risks, the rewards have been more than commensurate.”

During Plumbline’s most recent CAB meeting, members discussed how Plumbline could better communicate with clients and respond to their concerns during the recent market downturn. In the upcoming May meeting, the CAB will discuss Plumbline’s support services.

The CAB members are also consulted throughout the year, whenever key operational decisions are made. For example, before relaunching Plumbline’s website, the team asked the CAB members for their reactions to a test version.

CAB members, who feel invested in the firm because of their membership, are also excellent sources of referrals, which tend to spike in the weeks immediately after board meetings.

Despite the dinners and drinks, Manders and Jackson have been careful not to turn CAB meetings into client appreciation events. For one thing, Plumbline already holds popular client appreciation events twice a year, in January and February, and each CAB member is invited to one of those events annually. For another, Manders and Jackson want board members to take the advisory board process seriously and they expect to hear members’ honest opinions and appraisals on what Plumbline is doing.

@page_break@“We have some fundamental questions for advisory board members,” Manders says. “We’re looking for answers. So, we don’t want to confuse the issue.”

Manders and Jackson are considering launching a second CAB for Plumbline’s Toronto office, composed of clients who live in the Toronto area. “Is that demographic different? What’s important to those clients? asks Manders. “That’s what we would be finding out.”

Letting your clients show you the way



Reg Jackson and Paul Manders, two of three partners in a team of six that manages more than $300 million in assets for National Bank Financial Inc., describe the advisory board they created, the advice the board gives them and how that helps run the business.

IE