WE Family Offices, a wealth management house recently honored by this news service, is putting its weight behind an initiative to drive fiduciary standards.

With the Trump administration delaying the rollout of the Department of Labor Fiduciary Rule, an award-winning wealth management house has lent its voice to a program designed to put investors first regardless of whether the industry-changing regulation takes effect.

WE Family Offices said it supports the Best Practices Affirmation Program, recently launched by the Institute for the Fiduciary Standard. 

The Department of Labor’s fiduciary rule, which had been due to take effect in April, but has been delayed to the summer, imposes standards on how brokers charge clients to make sure they put customers’ interests first. The regulatory framework is designed, its supporters say, to make financial services in the US more professional and less subject to product “push” from fund providers and other entities. The rule is expected to affect about $3 trillion of client assets in the US. Firms such as Merrill Lynch have changed how they charge for financial advice. In the case of Morgan Stanley, the firm has kept open the option of charging commissions for those clients satisfied with that option. 

A concern has been that while a move towards more fee-based advice - an approach seen in the UK, for example - can make advice more objective and reduce “product push”, it may also not be ideal for all kinds of client and force some players out of business (as has happened in the UK after reforms came in from 2013). The current US administration’s delay has also been attacked by Democrat lawmakers in Congress (see here).

The Best Practices Affirmation Program helps investors to get in touch with advisors who put clients’ interests first, regardless of what rules come from Washington DC, Michael Zuener, founding member of The Institute for the Fiduciary Standard, and managing partner at WE Family Offices, said.

“Not only adhering to but clearly communicating these best practices is an important step an advisor can take to differentiate themselves and build trust with their clients, regardless of the outcome of the Fiduciary Rule,” he said.

The program is based on the Institute’s “Best Practices” and defines tasks that are not required by other advisor groups to ensure truly client-focused service. Advisors who take part in this program commit to honor best practices on their website and in their disclosures filed with the Securities and Exchange Commission (known as the Form ADV).

WE Family Offices was a joint winner with Gresham Partners at this year’s annual Family Wealth Report awards, in the category of multi-family office (above $3 billion of assets under management).