Global asset manager abrdn says key recommendations in the Quality of Advice Review (QAR) could rapidly accelerate the delivery of digital advice by super funds and assets managers like itself and significantly improve access to cost-effective advice for Australians.

abrdn executive adviser Jason Nyilas said the proposed shift from a prescriptive ‘best interest’ duty to a principles-based ‘good advice’ duty for advisers would remove significant roadblocks to providers who were waiting in the wings to provide Australians with digitally delivered advice and investment solutions.

abrdn believes the future of digital advice is bionic advice which combines the power of an artificial intelligence-driven digital advice process with human adviser interaction.  However, efforts to develop a bionic investment advice service in partnership with HUB24 have been delayed because of concern advisers that use the service may not satisfy the ‘best interest’ duty to clients.

Mr Nyilas said if the QAR recommendation for a replacement ‘good advice’ duty was introduced obstacles to introducing wide-ranging bionic advice solutions that abrdn has successfully operated in the UK for several years could be more easily replicated and implemented into the Australian market. Existing hurdles would be largely removed through QAR’s  reforms to reduce regulatory complexity.

In addition, Australian superannuation funds, which have a responsibility to formulate retirement income strategies for members under the recently introduced Retirement Income Covenant, would be able to more easily harness bionic and other digital advice strategies to satisfy this requirement at a lower cost to members.

“If the proposed QAR recommendations are introduced it will streamline and accelerate the introduction of digital advice in Australia and play a major role in reducing the advice gap and lead to better informed financial decisions for many more Australians,” Mr Nyilas said.                                      

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Brett Jollie

Aberdeen Standard Investments Australia Managing Director Brett Jollie welcomed the Retirement Income Review findings and its acknowledgement that insufficient attention had been given to retirement income.

“As Aberdeen Standard Investments (ASI) has said consistently, Australia has a gaping retirement income system gap. Up until now the solutions have been piecemeal. And it is fair to say that superannuation funds are not ready for the huge shift to decumulation, despite the fact it has already arrived for many Baby Boomers,” Mr Jollie said, adding he looked forward to the government’s response.

ASI Head of Retirement and Product Strategy Jason Nyilas, said a key recommendation of the 2014 Financial System Inquiry was that superannuation funds should make available what are referred to as Comprehensive Income Products for Retirement (CIPR’s) – an approach referenced in the review report.

“While we are happy with advancing the concept of the Retirement Income Covenant in order to provide an overall strategic framework that would guide members into effective retirement strategies, we believe advocating the CIPR approach now puts the cart before the horse. The industry should focus on looking at the complete end-to-end picture, starting with understanding an individual’s wants, needs, risk appetite and changing goals. Product should be the last thing you look at when designing retirement income solutions.

“Without an adequate and clearly mapped out retirement income solutions framework, Australians are headed into the unknown when they retire. We are not currently set up to offer mass customisation and a one size fits all approach is not what is needed. There needs to be a robust retirement income framework before we consider CIPR implications and I hope this review is a catalyst for this,” Mr Nyilas said.

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Global asset manager, Aberdeen Standard Investments (ASI), has signalled its intention to become a major Australian retirement solutions provider with the appointment of experienced wealth management and pensions professional, Jason Nyilas, as its Australian Head of Retirement & Product Strategy.

Aberdeen Standard Investments Australia Managing Director, Brett Jollie, said today that Mr Nyilas, who has extensive global experience in retirement, wealth management and digital solutions, would play a central role in growing ASI’s presence in the Australian retirement income space. 

“Mr Nyilas’ primary role will be to engage the market on retirement income needs and ultimately help provide retirement solutions for ASI clients.  We are keen to talk with, and listen to local investors, government and regulators on how we can best meet Australia’s growing demand for sustainable retirement solutions.

“The appointment of a highly experienced retirement specialist with a global perspective will allow us to commence those conversations and take a leading role in shaping the provision of retirement solutions in Australia.

“Jason’s knowledge and enthusiasm, coupled with our group’s United Kingdom pensions heritage, global investment capabilities and digital innovation, give us a unique suite of resources and insights to help tailor outcomes for industry, wholesale and individual retirement needs,” Mr Jollie said.

Aberdeen Standard Investments manages over AU$900 billion of assets worldwide and is part of the Standard Life Aberdeen group, which is also home to Standard Life, one of the largest and best-known long-term savings and pension brands in the United Kingdom.

Mr Nyilas joins ASI from EY where he was most recently seconded to Malaysia to develop the retirement framework for the Employees’ Provident Fund, which is the compulsory savings and retirement fund for private sector workers in the country.

Prior to this he was a wealth management executive and partner at EY Australia, and advised on M&A, retirement, digital, registry, wrap, blockchain and other transformation areas in the wealth arms of the big five banks, and industry, public sector and retail super funds.  Mr Nyilas previously worked for IBM as its Global Pensions Leader, running a superannuation back office business, IBM SuperLife from 2006 to 2009.

This is in addition to his senior wealth and finance industry roles in New Zealand, the United Kingdom and Austria. He has a Bachelor of Science Cum Laude (Finance and Management Science) from the University of South Carolina.

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