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Regulatory The Financial Conduct Authority (“FCA”) has pivoted to outcomes-based regulation with a requirement for firms to show how they are set up to deliver good outcomes for clients. In particular, the Consumer Duty Principle in the FCA Handbook, which requires companies to ‘act to deliver good outcomes for retail customers’, has set higher and clearer standards of consumer protection across financial services, and applies to our business in both investment management and financial planning. Consumer Duty represents a significant change and opportunity for the wealth management industry, highlighting the importance of delivering good outcomes for our clients. We are well positioned for this with a strong client-centric culture. Given the significant growth across the MPS market in recent years, the FCA announced the planned multi-firm review of MPS providers, which will commence later in 2025. The review will look at how firms are applying the Consumer Duty and aims to provide confidence that investors are receiving good outcomes from MPS and will share good practices on how firms are doing this. Furthermore, the Advice Guidance Boundary Review is the FCA’s response to address the growing concern that most consumers in the UK are not getting the financial help they need. The FCA is running a consultation with the industry on a handful of different ways in which it can approach the savings and advice gaps. The consultation closed in August 2025, with the proposed policy statement on targeted support and a consultation paper on simplified advice expected over the coming year.
Digital technology Simple and intuitive digital tools, which provide easy access to information and allow personalisation, are increasingly becoming the norm. Digital technology and AI adoption are improving productivity, reducing time and enabling greater compliance. We continue to enhance our digital capabilities, with an increasing number of clients accessing our services via our InvestBM portal. Over the year, we have partnered with an AI provider to expand the use of AI across the Group. We have recently deployed digital factsheets and launched the Brooks Macdonald mobile application to further improve the client experience. Our technological improvements are aligned with good practice from a Consumer Duty perspective whilst also ensuring efficient and appropriate record keeping.
Over recent years, a major trend has been the increasing prevalence of vertical integration, with firms offering both financial planning and investment management. Over this financial year, we have acquired three financial planning businesses, which create a scale financial planning firm alongside our investment management business. We expect the overall sector consolidation to continue, and to supplement our growth strategy with selective high-quality acquisitions. More clients working with IFAs, and IFAs increasingly outsourcing Investors are increasingly working with IFAs – our primary distribution channel – as the need for clients to make complex financial decisions grows. In addition, advisers continue to look to outsource investment management to allow them to focus on advising their clients and reduce their regulatory and administrative burden. We continue to help advisers serve their clients in ways that work for both parties, applying our investment management expertise to protect and enhance clients’ wealth. We are flexible in our approach, offering bespoke portfolios with more specialist variants, as well as model-based and unitised solutions, alongside investment solutions options tailored to the needs and requirements of the IFAs. The growth in our Platform MPS proposition reflects that these solutions are sought by IFAs as they fulfil their regulatory requirements and provide attractive solutions for their clients.
Brooks Macdonald Group plc Annual Report and Accounts 2025
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