This past year has proven to be quite a ride for advisors, regardless of their distribution channel. Yet, judging by the ratings in Investment Executive’s 2008 Report Cards, throughout the thick of it all, advisors have managed to avoid the obstacles and stay upright.

Certainly, in the past year, advisors have faced volatile markets, the asset-backed commercial paper crisis, a fluctuating dollar and the subprime mortgage crisis in the U.S. As well, the wave of consolidation that engulfed the mutual fund dealers a decade ago is now threatening to overtake the managing general agency world in the life insurance sector. Mutual fund and full-service dealers, meanwhile, are finally enjoying some stability.

But it is not the differences that stand out among the 1,930 advisors at 47 firms surveyed for IE’s four 2008 Report Cards, but how they are the same. All advisors value ethical and stable firms and the ability to make objective product choices based on their clients’ needs.

Nor do advisors’ businesses seem to be suffering as a result of uncertain times: their assets under management and the number of client households they serve are, in fact, rising, if by small increments.

“It is during times like these that you might expect clients to be pulling their money out, looking for an alternative,” says Dan Richards, president of Toronto-based Strategic Imperatives Ltd. “But, instead, it is the opposite, with clients feeling that they don’t have anywhere else to go. It’s not that clients are thrilled; they aren’t. They just don’t feel there are any alternatives out there at the moment. So, the good thing for advi-sors is that they are able to retain their clients during a difficult time.”

Advisors across all the channels — investment dealers, mutual fund dealers, banks and credit unions, and insurance — report their firms are stable places to work, despite the challenges the past year has thrown at them. Most advisors are not feeling lost in the madness; instead, they are praising their firms for staying on track.

In fact, every year, advisors stress the importance of their firm’s stability and the quality of the management’s leadership; this year was no different. Comments such as “I work for the most stable firm in Canada’” and “We are as solid as a rock” were heard throughout every Report Card this year — especially from advisors whose firms were bought out by larger companies.

One advisor in Ontario with Berkshire-TWC Financial Group Inc. was very positive about Waterloo, Ont.-based Manulife Securities International Ltd.acquiring his Burlington, Ont.-based firm. “Our stability just got a tremendous boost,” he says.

An advisor in Ontario with Toronto-based Blackmont Capital Inc. was also in post-merger bliss following CI Financial Income Fund’s acquisition of Blackmont’s former parent, Rockwater Capital Corp. “I have confidence in the new ownership,” he says. “During the transition to CI, it reassured us and delivered on everything it promised.”

Of all the channels, insurance advisors seem to be the less stressed, scoring their firms the highest in stability, at 9.4. Says an advisor in Alberta with Toronto-based MGA World Financial Group Inc.: “I think it is important for the people who work there, and for their clients, too, that the firm is going be there next week.”

An advisor in Saskatchewan with Winnipeg-based Great-West Life Assurance Co. says that the insurer’s stability is one of the main reasons why he would recommend GWL to another advisor: “There are lot of mergers, and Great-West is a big player in the industry. It’s always better to be the acquirer than the acquired.”

Dedicated sales agents repeatedly commented in the Insurance Advisors’ Report Card that the security offered by their company’s big brand name was a major reason for their firm’s stability. Advisors pointed out that the brand itself was one of the best aspects of a firm and that the firm or its parent had a long history was very reassuring.

“Stability and the Royal Bank of Canada name,” says an advisor in Ontario with Mississauga, Ont.-based Royal Bank subsidiary RBC Life Insurance Co. “It’s security for many clients.”

Along with stability, strategic focus can also be a major factor in a firm’s success in the Report Cards — and the overall increase in stability scores may be a direct result of firms putting strong leadership teams in place.

@page_break@“The leadership and management that firms have put in place over the past number of years are now being seen by advisors as responsive,” Richards says. “It is leadership that understands and listens to advi-sors’ needs. Firms across the board are doing a much better job of listening.”

Firms are increasing the number of advisor groups that provide feedback to management, as well as using regular satisfaction surveys to measure their performance, Richards says: “That’s the reason you are really starting to see that change.”

The 294 advisors surveyed for the Account Managers’ Report Card scored their firms strongly when it came to the firm’s strategic focus. Overall, the banking industry is pulling in top overall marks in a number of categories, including consumer Web site, marketing support for the advisor’s practice, consumer advertising, ongoing training and support services.

“The management team is very clear on the objectives of the bank’s strategic focus and its plans are well documented,” says an advisor in Ontario with Toronto-based Bank of Montreal. “The president is visible to everyone.”

So, advisors are feeling more stable and have more confidence in their firm’s leadership and strategic focus — and the proof is in the overall ratings. Scores have increased or remained the same in all categories except one: the firm’s succession program for advi-sors, which dropped to 7.6 from 7.8 in 2007. (See page C11.)

But firms are well aware of what they have to do to please their advisors. And the firms that have not had documented plans in the past have realized times are changing. Advisors now need reassurance of what will happen upon retirement, death or disability, not only to them but to their clients.

George Aguiar, president and CEO of Toronto-based GP Wealth Management Corp. says that documented succession plans have surfaced in the past three to four years, and GP is in the process of meeting the demand.

Succession planning isn’t the only category in which firms have realized they need to step up their efforts. Advisors say their firms have also spruced up their support services. For instance, support for wills and estate planning increased to 7.7 overall — an improvement of 0.7 from 7.0 in 2007; support for insurance planning also increased by 0.7 this year, to 8.2 from 7.5 last year.

“An in-house estate lawyer is there to offer suggestions on wills and estate planning,” says an advisor in Ontario with Toronto-based Richardson Partners Financial Ltd. “Everything we need is at our fingertips.”

It isn’t surprising that firms have started to improve their services. Advisors are starting to value these services more and more, as they perceive they help to meet clients’ needs. In the past two years, advisors have rated all support services — including transition support and support for high net-worth clients — higher in importance.

“With client’s lives becoming more complex,” says a Richardson Partners advisor in Ontario, “support services are more important than ever.”

The improved scores for support services can also be directly attributed to takeovers and parent companies stepping in with resources that weren’t available previously.

For instance, Blackmont’s support services have seen improved scores since it was acquired by CI. “We have a group of estate-planning specialists who are located across the country,” says Bruce Kagan, CEO of Blackmont. “This is just one area that we have bulked up as a result of CI buying us.”

And advisors with Toronto-based Assante Corp. and Regina-based Partners in Planning Financial Services Ltd. are praising their parent companies for turning the firms around. Both firms experienced increased scores in major categories, including stability, strategic focus, public image, ethics and corporate culture.

Of course, advisors will continue to suffer from consolidation and so firms’ rankings will feel the heat. Assante, RBC Dominion Securities Inc. and others attest it can be quite a ride getting things back on track.

Manulife Securities’ August 2007 acquisition of Berkshire will probably be reflected more in next year’s Dealers’ Report Card as the two groups of advisors were still being integrating during research for this year’s Report Cards. This past summer, the merged firm finalized its branding strategy, bringing all advisors under the Manulife brand. It will continue to bring technology platforms together as well as train advisors on the new system this fall.

“Berkshire and Manulife have very similar cultures, an approach toward independence and an approach toward our clients,” says Rick Annaert. president and CEO of Manulife Securities. “If you start with that commonality of vision, it makes the integration much easier. Our advisors are getting a chance to see just how much we align in business strategy.” IE