James Sharp & Co

Wealth management specialist James Sharp is one of few firms which could say that it was ready, on time, for Consumer Duty. As part of its preparation for Consumer Duty, James Sharp implemented MARS, the MorganAsh Resilience System, to assess, measure and report on their customers’ vulnerabilities.

James Sharp has been advising clients on investments for over 160 years and is one of Manchester’s oldest financial services firms. As with all wealth managers, customer relationships are key – but James Sharp realised that good knowledge of its clients didn’t necessarily mean good knowledge of its clients’ vulnerability characteristics, many of which are often unapparent.   

The firm wanted to enhance its approach to consumer vulnerability, so it could better evidence the heightened requirements that Consumer Duty brings about. To achieve this, it decided to upgrade the way it assesses and records vulnerability – so that it would be done in a way that delivered the richest possible data, as well as assuring compliance. Following discussions with regulatory consultants, James Sharp contacted MorganAsh, to explore the use of MARS.  

MARS takes a lot of complexity away from assessing consumer vulnerability, using input from consumers themselves to generate an objective measure of vulnerability which can be tracked over time.  

Prior to implementation of Consumer Duty’s enhanced expectations, we believed assessing vulnerability was pretty easy – since this is part of what we do every day. However, we wanted to get a better understanding of our clients – and realised that we needed external, expert help, as assessing vulnerability isn’t really our expert domain; our assessment could perhaps be likened to a nurse asking if someone is rich or poor. Not only is a binary question worse than unhelpful, to do it properly you need a good degree of understanding, plus a methodology to provide consistency and a way to manage the data – so you can report on it as needed. It became clear that to do this properly would take a lot of training and administration. The MARS tool negates the need for extensive training and handles most of the administration automatically, making this a far more cost-effective approach to consumer vulnerability.
— Sheriden Davy, chief risk officer at James Sharp

Everyone evaluates vulnerability differently, which leads to wildly inconsistent assessments. One way to overcome this might be to create a reference manual of every vulnerability, along with all the possible levels of severity – and then to provide training to every adviser. You would still need to build IT systems to store and report on the data – at a not inconsiderable cost. In contrast, MARS cuts assessment and administration right down, removing much of the need for training, plus doing away with having to create and maintain cumbersome manuals – and it’s prebuilt, ready to go. MorganAsh estimates that the benefit-to-cost ratio of using MARS, versus a manual approach, is around 6:1.  

There’s no question that advisers know their customers – but, after using MARS for just a few months, most advisers tell MorganAsh that they’ve uncovered consumer vulnerabilities they were previously unaware of. As a result of this, they were able to quickly adapt and be sure that vulnerable customers were receiving as good outcomes as those who were not vulnerable. Typically, such changes are highly appreciated by the consumer – and is good for both adviser and consumer over the long term. Enhancing relationships with customers is probably one of the most valuable outcomes of using MARS, one that’s just as beneficial as meeting the regulatory requirements of Consumer Duty. 

Peter Labrow

Head of marketing at MorganAsh. Consumer vulnerability champion. Writer and storyteller. Co-author: Is It News?

Previous
Previous

Clocktower Support

Next
Next

Forbes Securities