Trust in financial services ‘broken’ due to ‘arrogance’: Octopus

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Trust in financial firms is still half “broken” due to companies’ assumption that customers simply won’t understand things even if they explain them, Ruth Handcock said.

When asked what she thinks trust means in financial services, the Octopus chief executive said she tends to split it into two halves.

The first, she says, is the “table stakes” expectation that a company isn’t going to lose all of an investor’s money, while the second is whether a company is going to act in the best interest. of an investor.

It’s the second part, Handcock said, that “is the piece that’s broken.”

Speaking at a panel hosted by white-label platform provider Seccl, Handcock commented: “Regulation has been largely successful in the first instance, it’s not perfect, it’s not like s ‘there were no scandals from time to time. But it is largely successful.

“That last point is really important, because if you ask most people ‘do I think financial services organizations are on my side?’ you get anything from someone just laughing to, occasionally, someone saying “I can give an example of someone who could be”.

For Handcock, this part of the “trust puzzle” can simply be solved through transparency. She said that during the pandemic, Octopus Investments – an asset manager – made a concerted effort to release fund manager updates to clients “almost daily” in the first place.

“We knew everyone was going to be really worried about what would happen to the money they invested with us, and rightly so,” she said.

“We decided to immediately create a part of our website and post updates from the fund managers, almost daily at first, to say, ‘Here, that’s what we know, that’s what what we do is what we think the outlook view is’.

“We have been absolutely as transparent as possible. And I think that was exactly the right thing to do, because sometimes there’s a bit of arrogance in saying “don’t worry, I got it, I know what I’m doing, I’m just going deliver the results for you’.”

In Handcock’s view, investors are now expecting more. “They expect you to say, ‘this is what I do,’ that’s why you can understand this as well as I do, so I’m going to be open with you,'” she said. declared.

“It’s not just a fee. It’s about asking yourself, “Am I doing the right thing?” This is not to assume that people will not understand. They will understand if you explain it clearly to them. We all have an obligation to be transparent. That’s how I think you build it [trust] overtime.”

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