He said using the bank’s own network of advisers allowed it to use its own policies and procedures and run quality assurance checks so it had a clear view of what was happening. With external advisers, it had to rely on the regulatory regime, its relationships with stakeholders and the agreements it had in place. “It’s harder to control, you’d expect that as we don’t own them.”

But Body said there were more positive factors than negative about working with advisers. Many had done a lot of upskilling – at a high cost in terms of time and effort – and were committed to the industry becoming more professional.

But investment commission structures would likely change at some point. “As we transition from the old way, of trail commissions, to a fee-for-service at some point, how does the industry reorientate its service model?”

That could be done by educating clients about the services that were being provided and an adviser’s capacity to access external experts, Body said. “At the same time, having the industry on a path of increasing respect. The challenge is it’s not something that’s going to be achieved overnight.”

Body said independent advisers had nothing to fear from the banks. Some clients would want always independent advice and advisers should focus on determining where the clients were who were seeking that non-bank advice.  “There’s a niche. Every part of the market has a niche. Banks have distribution networks and advice forces but not everyone wants to get their advice from a bank.”

OnePath was able to manage its 528,000 strong KiwiSaver base with just 100 AFAs by leveraging off the scale of ANZ to invest in support services, he said, and working on digital offerings.

The regulatory regime and licensing laws would build a more robust industry so people could be more confident that the risk they were taking on was the risk they thought they were taking, he said. But participants also needed to work towards greater transparency.