Company Profiles

A Deep Dive Into Wealth Planning, Client Needs At RBC Wealth Management

Tom Burroughes, Group Editor, London, 6 May 2022

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How busy are you in creating strategies for estate plans, succession, business transfer and the use of trusts, foundations and other structures? Do you see trends in the structures and approaches people like to use?  
Speaking with our clients, we find that the impact of inheritance tax is the number one concern for preserving wealth. More specifically, clients are concerned about developing an effective estate planning strategy – common concerns include not knowing how much to gift and when or wanting to understand how to gift while retaining an element of control.

The biggest trend we are seeing is towards a diversification of structures used to support estate planning goals. Clients are familiar with the concept of diversifying investments to reduce risk and the same applies to the use of different structures.

Whether it’s a trust, a corporate entity or a foundation, all structures have their own merits and disadvantages when it comes to access, control, taxation, fees, reporting and governance, but some may serve clients better than others in specific situations. A good example is comparing the use of trusts and corporate structures – with entry charges applying on most gifts to trust above the limited nil rate band. Many families continue to opt for a corporate structure if they are transferring larger amounts of wealth and have specific intentions as to who they want to benefit and to what extent, which can be drafted through a shareholder agreement.

At the same time, it may be complimentary to use a trust, either to hold shares in the corporate entity or for a different purpose altogether such as ringfencing funds specifically for grandchildren’s education. The corporate entity will be governed by articles and a memorandum, whereas the trust will be governed by a deed each with differing rules to abide by. Having assets held across both provides some reduction to the impact of legislative risk whereby a change in legislation is favourable to a corporate structure versus a trust or vice versa.

What approaches does RBC adopt in building a pipeline of new clients – how you interact with intermediaries, advisors, etc? Do you have a particular approach to marketing? Do you track net promotor scores, other metrics, for a sign of progress? What is your client retention like? 
We believe that our best introducers are our clients themselves. Although we work closely with intermediaries, our focus is to understand our clients’ ecosystems and ask them for referrals. Researching and understanding who our clients know, whether business partners, families or advisors and asking for qualified introductions has stood us in good stead to build a pipeline.

We regularly undertake short surveys at different points in the client lifecycle to ‘temperature check’ what we’re getting right and where we should be improving.

We met shortly before International Women’s Day, but of course the need to add more female advisors, help HNW women clients, remains a constant area of focus. Please elaborate on the work you do in this area. 
The industry has work to do to improve our standing with female clients, and to attract more women to working within the wealth industry. We know from our research and our earlier work with WealthiHer that women do not feel served or heard by the industry.

From a client perspective, our focus remains on educating our female client base and building their confidence with regards to their finances.

From a recruitment, perspective, our organic growth and development plans for relationship managers means that over time, we become less reliant on having to attract female advisors from a small external pool. Ensuring that we are bringing in young, female talent and developing them is a core part of our strategy

With external hiring, we ensure that we are direct with recruiters about looking for a diverse set of CVs. Then we talk about RBC’s culture and values which resonate well with a female audience. Diversity and inclusion is embedded into our culture. But we believe in doing more to realise opportunities and address challenges. We also believe that we can achieve progress in areas that are under-explored and lead change through ideas and action. Ultimately, we focus on helping people to succeed, making a positive impact on our clients and in the communities where we live and work.

With City National Bank, RBC has an important connection to the world of entertainment, etc. Does the RBC business continue to evolve in the way in which it looks at certain client segments? 
We view the world in terms of two broad client types: business owners and entrepreneurs and corporate executives. This allows us to identify broad buying behaviours, spot trends and provide insight whilst still allowing the latitude to speak with clients across a range of wealth backgrounds. This can also be evolved over time, for example, our recent development of a strategy for PE executives, or connecting our work with the Brit School, and CNB’s prevalence in the space, with the media world.

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