Adviser industry comes together to launch AdviserAction

29 November 2023

  • AdviserAction brings advisers under one umbrella to engage directly with companies, facilitated by sustainable investment pioneer CCLA
  • Membership organisation puts financial advisers in the driving seat for real world change at companies
  • AdviserAction responds to retail investor demands for visible action

A select group of firms from the advisory industry have come together to form AdviserAction, a first-of-its-kind membership organisation, facilitated by sustainable investment pioneer CCLA. Through AdviserAction, founding members Castlefield, Clear Financial Advice, ESG Accord (Accord Initiative), Fintel PLC, Kellands Chartered Financial Planners, Lyndhurst Financial Management, Paradigm Norton and CCLA will focus on engagement with listed companies to drive sustainable outcomes.

Up to now, financial advisers have played a key role in promoting the development of sustainable finance, but the structure of the industry has made engagement with investee companies almost impossible. Engagement is one of the few ways that investors can make a difference; by using share ownership rights to influence policies, processes and behaviour of an investee company they can change practices for the better.

AdviserAction has been created to empower advisers in the UK, to advance clients’ interest in improving sustainable outcomes and to pool resources to enable advisers to participate in corporate engagement.

This comes at a critical time where regulatory demands to deliver good client outcomes have never been so high. A recent Financial Conduct Authority (FCA) survey of 20,000 consumers identified that 81% would like their investments to do good as well as deliver a financial return. Furthermore, the introduction of Consumer Duty by the FCA requires a high standard of proof that the advisory industry is delivering good client outcomes in its recommendations, which includes investment advice.

By supporting the advisory industry to deliver on its sustainability commitments to clients, AdviserAction is a chance to put client interests in doing good at the forefront. It will also provide tools to achieve transparency and visibility and it will develop training to increase members’ knowledge of key sustainable finance issues.

The members of AdviserAction will be able to select a number of issues, or specific companies, on which to conduct engagement with companies and/or policy makers. 

As its initial engagement focus, AdviserAction has chosen to focus on mental health in the workplace.

First initiative - mental health

One in four people are estimated to have a mental health problem and research indicates that an estimated 12 billion working days are lost globally each year to depression and anxiety alone. Meanwhile, for every US$1 invested in scaled-up treatment for wellbeing in the workplace, there is a US$4 return in better health and productivity, according to research published in The Lancet.1

AdviserAction has signed the CCLA-convened Global Investor Statement on Mental Health and following that, through its secretariat, will lead engagement with Frasers Group and IBM on this issue. These firms have been chosen because both are common portfolio holdings and currently rated in the lowest tier of the CCLA Mental Health Benchmark, designed to assess objectively how listed companies approach and manage workplace mental health.

Membership and mechanics

AdviserAction is open to any adviser firm wishing to join and it will be overseen by an advisory committee formed of members. CCLA is convening the new entity and will provide support which will expand as the group grows. Engagement on behalf of the group will be led by CCLA who will also co-ordinate other activities.

By joining forces under one umbrella, the advisory industry will take on wide and effective engagement on the subjects which matter most to their clients.

John Eckersley, Founder and Chair, Castlefield said:

We’re delighted to be part of this innovative partnership, as it brings together some of the leaders in sustainable investment and complements our existing engagement activities.  The AdviserAction initiative will enable advisers to experience company engagement first-hand and, in turn, to talk to their clients about the benefits of investing in funds with active stewardship programmes.

Louis Greening, Investment Specialist, Clear Financial Advice, said:

Advisers have needed evidence that engagement works. This platform is not just a way of showing that good engagement works - it also helps advisers do better by their own employees. We also feel this will help connect clients more fully to their investments.

Lee Coates OBE, Director, ESG Accord (Accord Initiative), said:

We are fully behind this exciting initiative.  Providing advisers' clients with the ability to directly engage on issues that are important to them will be very welcome. We believe it will enhance the client-adviser relationship and lead to better engaged and better-informed investors. It will also demonstrate another benefit of seeking financial advice.

Kate Kwiakowska, Head of ESG, Fintel PLC, said:

We are pleased to be part of this transformative collaboration, enabling financial advisers to influence positive change. Engagement is a cornerstone of building a sustainable future for the sector, and the AdviserAction initiative provides a vital platform for advisers and clients to actively participate in steering companies towards sustainable practices, fostering a shared commitment to positive change.

Paul Edwards, Head of Operations, Kellands Chartered Financial Planners, said:

We now have a way to give clients a voice in furthering sustainable ventures. Engagement is for us an untapped sustainability tool that can genuinely change outcomes for the better.

Geoff Newman, Director, Lyndhurst Financial Management, said:

Increasingly our clients want to know what difference their investments make and finally we have a way of evidencing that. We are delighted to have this opportunity to engage and make collaborative change happen.

Farida Hassanali, Investment Committee Deputy Chair, Paradigm Norton, said:

We strongly believe in the power of engagement and are delighted to join this collaborative approach to help evidence this in action.

Peter Hugh Smith, Chief Executive, CCLA, said:

With the final rules on the FCA’s Sustainability Disclosure Requirements now published, we believe engagement is more important than ever as a way that investors can encourage companies towards sustainability improvements and make a noticeable difference, whatever the size or scope of their portfolio. This initiative will, for the first time, empower independent financial advisers to speak on behalf of their customers to the firms they ultimately invest in, and to participate in working towards a better world.

1 Data from The Lancet.