“There is always risk in everything we do, and as a Financial Advice Provider (FAP), you’re going to have risks just like you do today as a financial advisory business,” Greenslade said.
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“There are a multitude of ways that you can do this – you don’t always have to transfer your risk across to a third party through PI. You can do that through good training of your staff, through putting new processes, systems and software in place, using different outsource providers, or engaging compliance providers and expanding on their remit around what you want them to check.
“These are all control methods where you’ve identified that there’s a risk and you know you can’t eliminate it, but you can manage and control it, and you can measure how you’re tracking against it.”
Greenslade says that in some cases, advisers may choose to ‘retain’ the risks they can’t eliminate, and simply learn to live with them. He says avoiding risk is also a common strategy, though it’s one that doesn’t always pay off for advisers, who may lose out on business…
