Every organism must be prepared to adapt to its changing environment or, ultimately, it perishes. The financial services industry is no exception. Whether it’s facing evolving investor appetites or a new economic world order, the industry must be prepared to adjust.

At the macro level, the balance of power in the global economy is shifting. Emerging economies have been growing much faster than developed ones for some time now. The financial crisis and the subsequent severe global recession have only served to amplify the influence of emerging economies. As the developed world deleverages and pares back its consumption, the developing world becomes that much more important to international growth.

In the years ahead, emerging markets are expected to overtake the world’s traditional economic powers; they will soon become the dominant forces within the global economy.

To their credit, Canadian policy-makers have recognized this shift, and are ramping up efforts to do more business with the economic powers of tomorrow. Most recently, representatives of the financial services industry and industry policy-makers completed a trade mission to China. More of this sort of effort will be needed in the years ahead.

Meanwhile, at the micro level, the financial crisis and recession have wrought changes of their own within the Canadian financial services business. This year’s series of industry Report Cards by Investment Executive reveal a notable flight to safety by Canadian investors. Not only are investors shifting their portfolios to a more conservative asset mix, but they are also migrating to the more conservative corners of the industry. Advisors with brokers and dealers are seeing assets escape to their competitors in the banking and insurance sectors.

Here, too, the industry’s future is unlikely to resemble its past. While brokers and dealers had a fairly easy time winning business from the big institutions back in the early 1990s, things have changed a lot since then. The banks now dominate the mutual fund industry, and the quality of their advisory teams is greatly improved. The insurance business has evolved dramatically, too. Financial advisors who aren’t prepared to deal with this new environment may well find their survival in peril.

Amid such tectonic shifts, it’s more important than ever for firms and advisors to be prepared to adapt — or die.