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     MAY 2020 PAGES 8-16
Ratings for the 14 firms in this year’s Report Card
Pre-crisis market growth and shift to wealthy clients were boons
Technology investment is key, say advisors and firms
One firm topped the ratings while another plummeted
Multiple challenges exist for advisors exploring responsible investment
Advisors are largely supportive as firms adapt
Firms share plans
for fee-based and discretionary platforms
RESEARCH BY Emily Fox, James Gaughan, Surina Nath, Swikar Oli
 Lessons for firms in flux
advisor in Ontario puts it, the main aspect to improve would be “getting their act together on amalgamating their business. They’ve got to get a vision of what they want the company to look like.” Another advisor in Quebec says, “There’s integrity, [a] good name [and] stability. It’s a good firm that needs to improve.”
In a statement emailed to IE in late March, the firm says its approach was “very siloed” prior to 2018. Now, “We have a framework that brings together all wealth-management components,” including its mutual fund- and invest- ment-focused businesses and its manu- facturing arm. Going forward, “part of our ongoing structural change will see us sunset the HollisWealth name in 2020 and focus on our iA Wealth brand.”
In the bank-owned brokerage space, structural changes also drove perform- ance ratings. The IE ratings for BMO Private Wealth Canada and Asia, Wood Gundy and ScotiaMcLeod Inc. (all based in Toronto) reflect advisor sentiment about management shifts within the past year and a half.
Following its decision to merge BMO Private Wealth and BMO Nesbitt Burns in early 2019, BMO’s 2020 IE rating for its brokerage business was 6.9, down more than a full point compared with a year ago. Many advisors said their value wasn’t recognized and that the brokerage culture was degrading.
According to Andrew Auerbach, head of BMO Private Wealth, Canada and Asia, the firm’s overall approach “reflects what our clients want and have asked for: the ability to easily access all of BMO Wealth Management’s expertise in one place with ease.” He says advisors have better access
Brokerages must help advisors weather the economic crisis
While several of the firm’s advis- ors acknowledged resulting back-office issues, they generally praised manage- ment’s focus and the calibre of new hires. Says another Wellington-Altus advisor: “The ability to share, work together [and] collaborate is unreal.”
Others noted the firm may not be for everybody. To fit in, “[You] have to be able to create business, meet people and be outgoing. Some people prefer structure,” a Wellington-Altus advisor says.
Shaun Hauser, founder and president of Wellington-Altus, says the firm plans to offer more support. “The one thing we think we’re going to invest in over the next three to five years is advisor develop- ment. Every dollar we spend into advisor development, we think we’ll get it back threefold.”
iA Securities had some of its highest rat- ings in the stability and products categor- ies, but the firm’s performance dropped significantly in 13 other categories.
Aside from technology issues, road- blocks mentioned were a fragmented national reputation and lack of holistic planning support, such as access to wills and estate planning experts. The firm’s lowest rating was 4.8, for “support for developing a financial plan for clients,” which fell from 5.7 last year.
Many iA Securities advisors were looking for a sense of direction. As one
 before the covid-19 crisis, finan-
cial advisors in the brokerage space were likely looking forward to a strong 2020. According to Investment Executive’s (IE) 2020 Brokerage Report Card, respondents’ average book value heading into late February had risen approximately 14% year-over-year to $201 million — nearly double 2014’s value of $102 million — even while advisors served fewer households. (See story on page 11.)
Stock indexes around the world hit all-time highs in early 2020 and played a major factor in book values. Markets and economies have taken a dive since then, and this year’s Report Card shows that advisors’ success and satisfaction hinge on whether firms help them navigate shifting markets.
“We’ve got significant experts in areas like capital markets and we can offer some interesting investment options and port- folios,” says an advisor with Toronto-based CIBC Wood Gundy in Alberta. The firm’s IE rating (the average of all a firm’s category ratings) rose nearly a full point year-over- year to 8.3, and advisors rated “quality of firm’s product offering” significantly higher (by half a point or more) at 8.9.
An advisor in Alberta with Toronto- based Richardson Wealth had the opposite view, saying that firm “needs to improve upon capital markets” because Toronto- based GMP Capital Inc., one of Richardson
Wealth’s controlling shareholders, sold that business unit in 2019. As a result, the advisor says, “We need better research.” Richardson Wealth, formerly known as Richardson GMP Ltd., saw its IE rating dip 0.1 to 8.7 and its product quality rat- ing drop 0.8 to 8.4.
This year’s IE ratings were flat year- over-year across most firms, with the average IE rating rising only 0.1 to 8.4. This continued improvement over the 2019 results is meaningful, however, given that the average IE rating from 2015 to 2018 was 8.1.
Not all firms were equal. The gap between the IE ratings for the top- and lowest-rated firms was significantly wider than a year ago (at 2.7 in 2020 vs 1.9 in 2019), and it seems that a clearly communicated firm strategy can make or break a rating. Advisors with new entrant Wellington-Altus Private Wealth Inc., based in Winnipeg, gave the firm an IE rating of 9.6, while Quebec City-based Industrial Alliance Securities Inc. (i A Securities) received a 6.8. (See story on page 14.)
“We’re on fire,” says one Wellington- Altus advisor, referring to the firm’s expo- nential growth over the past few years. As of April 2020, the firm had more than $10 billion in AUM and over 140 investment advisors and offices in 22 locations, up from $2.5 billion, 14 and five in 2017.

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