A prominent figure in Singapore's wealth advice arena says that while business is improving, there is a need for more financial literacy and better advisory standards in the jurisdiction and beyond.

Singapore must further raise the calibre of its wealth advice industry and the financial literacy of its population - tasks that are essential in avoiding mis-selling in a world less tolerant of such failures, a senior figure in the sector says.

While it is now one of the great wealth management hubs of the world and a rival already to centres such as London and Zurich, the Asia city-state still falls short in some respects, Joseph Kwok, deputy general manager and head of product at Professional Investment Advisory Services (PIAS) and president of the Financial Planning Association of Singapore, told this publication recently.

With his twin roles of driving product strategy for PIAS, a large financial advisory business, and as FPAS president, Kwok has a ringside seat on some of the regulatory and client issues affecting wealth management in Southeast Asia.

"The competency of financial players is still not the most optimal at the moment and we need to look at improving that. There is still some mis-selling of financial products," Kwok said.

A number of institutions in the jurisdiction are promoting the financial literacy message, for example the Institution For Financial Literacy, a collaboration of MoneySENSE, a public body, and Singapore Polytechnic. Some 10 years ago, the Monetary Authority of Singapore issued its first-ever financial literacy survey, finding some positives – Singaporeans were found to have a generally pro-savings culture – and some concerns over whether citizens are taking enough action.

Authorities in Singapore are seeking to raise the bar for financial advisors as well, taking a lead to some extent from the kind of reforms in the UK that have seen moves to raise standards of competence among financial advisors and increase transparency over fees. Singapore has introduced legislation called FAIR – Financial Advisory Industry Review. The rules stop short of an outright ban on trail commissions for product sales, while the UK’s Retail Distribution Review that came into law in 2013 aims to do so.

"The increased regulation prompted PIAS to re-examine its product strategies to be aligned with the new requirements," he said.

Kwok, who was appointed to his PIAS role earlier this year, initially focused on product and research that looks at due diligence of wealth management products sold by PIAS advisors. He has since seen his role adjust and is now developing product strategy to cater to different client segments of PIAS. He brings more than 15 years’ experience in the industry to his current job. Kwok previously was a senior manager at JP Morgan Private Wealth Management, Platinum Capital Management, UBS and Standard Chartered Bank, among others. As for his FPAS post, he was elected president in April. This organisation runs the Certified Financial Planner qualification and is part of a broader move by the wealth industry to raise standards. WealthBriefingAsia recently interviewed the CFA Institute in Asia about the importance of talent management.

Elaborating on his role with PIAS and its products and services, Kwok said: "We have relationships with wealth managers, life insurance companies, offshore insurers like Generali, Friends Provident and Zurich. Most of the current products are targeted at mass-market customers. We are looking at our segmentation strategy to target at higher net worth clients.”

Kwok said he typically doesn't talk to the regulatory authorities directly in his PIAS capacity but his role in FPAS puts him into contact with organisations closely associated with the regulatory authorities, such as the Institute of Banking & Finance.

"We are part of a group giving feedback on knowledge, skills and competence of financial advisors," he said.

Happy clients
"For my PIAS role, client satisfaction is important; on the products side, we would like to adopt a more client-centric approach and getting away [from] thematic products," Kwok said. He added that, having been in his role now for more than 100 days, there has been progress in developing a proposition for HNW clients.