Every advisor has had to deal with a disgruntled client occasionally. Whether the client is upset after a nasty market correction or believes his or her wishes have been misunderstood, dealing with an unhappy caller is always a challenge.

If you get a message from an angry client, it’s important to call him or her back as soon as you can. If you can’t make the call quickly yourself, get an assistant to call on your behalf.

“You don’t want to give a client the impression you’re avoiding them,” says Ellen Bessner, a partner with Toronto-based law firm Cassels Brock & Blackwell LLP and a legal advisor to the financial advisory industry.

Allow your client to talk, so he or she can vent, and do not to try to dominate the conversation yourself. It’s critical that you listen.

“You need to understand what a client is thinking,” Bessner says. “It’s not just about losing money for them. They may be scared.”

Take notes during the call. Try to coax out what the real issues or complaints are and separate them from the emotion.

Try to talk through the problem with your client. Remind the client of your previous discussions about his or her risk tolerance, time horizon and goal-setting. This would also be a good time to ask if anything has changed in the client’s life or goals. Keeping copious notes throughout all your dealings with clients will, of course, stand you in good stead when disagreements arise.

Remind the irate client about what is controllable and what is not. Neither you nor your client can control the markets, changes in the law or the shifting circumstances in the client’s life. Instead, look at the choices that are available for solving any problem your client might have.

Remember that as an advisor, you are not a guarantor of results, Bessner says. If you’ve done your job well all along, you have given your best advice to your clients and will try to continue to help them achieve their goals.

While it’s important to give your angry client a full hearing, it’s critical that you don’t apologize or admit wrongdoing under any circumstances, Bessner says. Doing so may have a number of adverse consequences, including denial of coverage by your errors-and-omissions insurance provider.

Also, new regulatory requirements recently adopted by the Investment Industry Regulatory Association of Canada and the Mutual Fund Dealers Association of Canada stipulate that your firm’s compliance department must conduct a preliminary investigation into oral complaints, so you must report any such complaint to them immediately.

Of course, if you’re managing your client relationship well, Bessner says, many potential problems can be nipped in the bud.

@page_break@If there’s bad news to give to a client, be proactive and contact the client before a situation starts.

“It’s human nature to want to avoid having to deliver unwelcome news,” Bessner says, “but it’s important that you communicate with your clients. It’s better to keep a client calm than to have to calm a client down later.” IE