After its annual meeting in Auckland yesterday, the ISI announced its members had voted for it to investigate a major change in focus that would see it renamed the Financial Services Council.

Discussions are underway with other financial services industry organisations to gauge support for the development of a pan financial sector group.

ISI members are looking to have a "highly influential industry organisation," according to ISI chief Peter Neilson: "They want an 800-pound gorilla."

If the proposal goes ahead the newly created group would look very different to the current ISI, with a focus on information and lobbying rather than industry self-regulation.

"There are severe limits in ISI trying to be an industry self-regulator when not every player belongs to the association," according to the ISI.

"And, as a voluntary organisation, any member who does not agree with any self-regulated proposal can simply leave to avoid them."

Neilson said with budgets tight, members were reviewing their spending to see whether they were getting value for money from membership of various groups.

He said there were too many small financial industry organisations and due to their lack of scale and resources they could be ignored when policy decisions were made.

"If you're the Agriculture Minister and you propose a new policy to the Prime Minister he will probably ask ‘what does Fonterra or Federated Farmers think of this?'" he said, adding there was no one group with that sort of power in financial services.

Neilson wouldn't say which organisations ISI had talked to but said the proposed super-group would include all parts of the financial services chain, including financial advisers.

However, he said it wouldn't try to represent the whole financial industry as there would be conflicts between different parts of it.

The foundation projects for the new group would focus on the insurance gap, on the future of long term savings and KiwiSaver and the future of regulation.

Neilson said the latter project would look at the best environment for regulation, and he said the current crop of financial regulations would likely be overhauled at some point.

"These things tend to move for ten years in a direction," he said.

"Sometimes when you do things you do have to respond to public opinion - not everything they have done is going to turn out as good as they expect."