'Wealth managers shall give meaningful advice'

New Delhi: With the expected increase in retail penetration, it is important to have wealth managers who can prescribe meaningful investment advice aligned to the clients' risk tolerance, return expectation and financial needs, a Sebi official said on Thursday. Also, given the fiduciary responsibilities of a wealth manager, it becomes equally important for them to be grounded in ethical principles, such as client confidentiality, transparency and objectivity, S K Mohanty, Wholetime Member of Sebi and Director at NISM, said. He made these remarks at the launch of comprehensive certification programme in wealth management by the National Institute of Securities Market (NISM), in collaboration with CRISIL.

The programme is aimed at ensuring investors get quality advice to negotiate the maze of products. It will cover the entire lifecycle of wealth management, equipping participants with deep conceptual understanding, and ability to use that to serve clients effectively, and aims to build wealth management capacity at banks, NBFCs, mutual funds, brokerages and family wealth offices. While traditional curricula provide a good grasp of financial products, most are academic and follow global practices.

On the other hand, the NISM and CRISIL certified wealth manager programme is tailored to directly address client-specific needs of building, growing and sustaining wealth aspects where traditional savings channels come up short because incomes and aspirations keep changing amid rising product complexity. "With the expected increase in retail penetration, it is important that investor interests are protected," Sebi's Mohanty said at the virtual event. He, further, said "the need of the hour is to have wealth managers who can prescribe meaningful investment advice aligned to their clients' risk tolerance, return expectation and financial needs".