A report casts a bright light on the contention that clients are more loyal to their relationship managers than firms.

(An earlier version of this article appeared in Family Wealth Report, sister news channel to this one. Given that the findings are drawn from a global sample, we hope readers in Asia, the Middle East and Europe, among other regions, find it of value.)

Relationship managers lack “pulling power” compared to the organisational brand under which they operate, according to a global survey of over 3,000 wealthy investors.

The findings are interesting as client perceptions of firms are often shaped by personal experiences, Milton Pedraza of the Luxury Institute previously told this publication.

“The flag you are sailing under is important, but the sailor matters most,” Pedraza said. “Very often people will recommend an individual at a firm which may or may not have the best reputation - but the individual might, and that can win out. Sometimes the brand can either enhance or deter from the perception of the experience.”

Less than a fifth (19 per cent) of those surveyed for the first installment of the 2015 Futurewealth series said they would follow their advisor to a different organisation, while 62 per cent would “stay in the warm hold of their existing firm” in such an event. 

However, when clients rate their relationship managers as “very good”, there is nearly a 50 per cent chance that they'll move on too should that contact point leave, according to the report, entitled The art and science of relationship management, released today by Scorpio Partnership, SEI and NPG Wealth Management.

Sebastian Dovey, managing partner at Scorpio, acknowledged that, for bankers with higher satisfaction rating scores, the appeal to follow is of course “still a relatively strong option among clients.”

“While personal relationships with individual wealth managers are still clearly important, this research suggests that the power of the brand is growing, which is good news for valuations of firms,” said Brett Williams, managing director of SEI Wealth Platform, UK.

“But given the trend for consolidation in the industry, this also presents challenges,” Williams said. “Following a takeover, firms need to make sure they invest time and effort in bringing customers with them to the new brand.”

“Strategic role”

With the above said, the findings reinforce that the “Futurewealthy” have high expectations of their relationship managers and in fact hold them “directly responsible” for their wealth creation efforts, said Marc Stevens, chief executive at NPG Wealth Management.

For example, 59 per cent of those surveyed believe it is the relationship manager's duty to improve a client's financial situation, while for a further 42 and 37 per cent, their main remit is to provide investment education and deliver market updates, respectively.

“It is therefore crucial that wealth management firms can support front line staff with the resources and insight they need on a broad variety of products and services,” Stevens said.

The “strategic function” of relationship managers is also reflected in the qualities that are attractive to investors, with professionalism the top-rated attribute, according to 67 per cent of those surveyed. Characteristics such as intelligence and integrity are significantly more important to investors than sensitivity, sociability and empathy, the report said.

Cultural nuances

Meanwhile, it emerged that the strategic role is accentuated in certain regions around the world, with 42 per cent of investors in the Americas believing that the relationship manager should create their financial strategy.

That figure is only 30 per cent in Europe - where mentoring is more central to the function - and there is a stronger focus on market updates in Asia-Pacific.

The 3,113 individuals surveyed have an average net worth of $2.7 million.