Market overview
Long-term trends Demographic changes
Average portfolios by intermediaries
Investment Service, Decumulation, Court of Protection. We also offer model-based and unitised solutions, alongside Investment Solutions options more tailored to the needs and requirements of the IFA. The growth in our Platform MPS proposition reflects that these solutions are sought by IFAs as they fulfil their regulatory requirements as well as providing attractive solutions for their clients. Regulatory The Financial Conduct Authority (“FCA”) supervises the investment management and financial planning activities of Brooks Macdonald in the UK. Over time, the regulator 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 that 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. The FCA continues to focus on ensuring advice and investment management is conducted appropriately and professionally, and on giving transparency to clients on fees and charges. 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 to do this with a strong client-centric culture. We are focused on fulfilling the Consumer Duty’s price and value outcome principle, in particular, by moving clients of an appropriate size from our bespoke offering to an MPS
about what standards these products observe and what certification regimes clients and advisers can trust. While there has been a decline in demand for ESG products across the industry over the last couple of years, we expect this to reverse when economic conditions improve. Advisers continue to forecast rapid growth in the proportion of client assets allocated to sustainable and ESG-based products and services over time.
£0.6m
The UK population continues to age with the proportion of people over 65 growing steadily. In parallel, the policy framework around retirement is favourable for the wealth management industry with people increasingly encouraged to make their own provision for retirement and pension freedoms adding to the need for advice. The total wealth of the UK population is projected to continue to grow, and over 70% of that wealth is held by those aged 55 and over. Increased life expectancy, wealth and pension freedoms all add to the increasing demand for advice as complex financial decisions are in the hands of individuals.
£0.5m
£0.4m
£0.3m
£0.2m
£0.1m
Our response
£0.0m
We offer a Responsible Investment Service (“RIS”) within our Bespoke Portfolio Service, which is also available in our Managed Portfolio Service and Investment Solutions offering. We have Advance and Avoid strategies available and investment performance has been strong since launch. As a Company, we have signed up to the UN Principles for Responsible Investing and consistently apply a sustainability lens to our core investment process. More clients working with Independent Financial Advisers (“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 to 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, e.g. Responsible
Bespoke
MPS off platform
Execution only
MPS on platform
Average portfolios by direct
£2.5m
Our response
£2.0m
Brooks Macdonald continues to work with clients to support them in their retirement planning, reflecting the fact that retirement is the biggest trigger for people to seek financial advice. Our Decumulation service is aimed at people in the early years of retirement balancing the need for income with the need to stay invested to protect their future wealth. We are also improving our support to clients around intergenerational wealth transfer, as well as encouraging people to think about their retirement earlier. Growth of responsible investing Advisers and clients alike are increasingly looking for investment managers to provide products and services meeting their environmental, social and governance (“ESG”) criteria. Providers are bringing products to market, but there is widespread confusion
£1.5m
£1.0m
£0.5m
£0.0m
Charities / Corporates
Private clients
Clients with Independent Financial Advisers
£4.0m
£3.5m
£3.0m
2020
2021
2022
14 Brooks Macdonald Group plc Annual Report and Accounts 2024
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