AWD to double adviser salaries in recruitment drive

AWD Chase de Vere is set to announce an overhaul of its remuneration strategy as the company seeks to boost its adviser base by 15%.

Advisers' base salaries will at least double while bonuses will be more closely linked to what it calls "assets under influence" (AUM) and recurring revenue business.

The Swiss Life-owned business currently has 178 advisers but CEO Stephen Kavanagh says the company's business strategy is being built around an adviser base of about 205.

It will look to recruit advisers individually, Kavanagh says, but, failing that, it will look to buy an IFA with about 30 advisers.

"We are about to launch a new employed contract for our advisers," Kavanagh says. "It will have a higher base level with bonuses linked to AUM. Our whole drive has been to have assets under influence, eliminate upfront commissions and build recurring revenue."

Kavanagh says, in January 2008, 18% of its income was generated via recurring business. That figure is now 50%.

In January last year, AWD said it had overhauled its adviser bonus scheme to reflect quality of advice rather than number and profitability of sales.

The company said the move would see advisers with a falling balance sheet still receive a bonus if they had followed "good" financial advice processes.

It followed a £1.12m FSA fine in November 2008 for "serious" advice failings that led to pensions mis-selling.

According to the regulator, as many as 800 people may have been badly advised by the firm between February 2006 and October 2007.

Kavanagh says the business has undergone a "huge change" since then, selling mortgage consultancy Home Finance, adviser firm Read and a corporate services business. It also offloaded its online price comparison service, AWD Moneyextra, earlier in 2008.

"We have changed things so dramatically," he says. "We had several different businesses all going on at once back then. We had five businesses with 1,000 employees, now we have two with 420 employees.

"Our relationship with the FSA is as strong as it has been in a long while."