Charlie Viola

The newly formed Principals’ Community, headed up by Kon Costas, has received strong support from the self-licensed community with more than 92% of previous businesses signing new agreements this year.

The independent community parted ways with BT Financial Group after more than 7 years, with the sole purpose of providing support and guidance to AFSL holders without encountering conflicts from institutional ownership, rules surrounding being a product manufacturer or platform provider and having existing AFSL obligations.

Costas says: “The feedback and support we have received from the 122 community members has been exceptional, truly highlighting a significant desire for support as they grow in the everchanging post-Covid and post-Royal Commission environment.”

Current members such as Charlie Viola, Partner at Pitcher Partners Sydney Wealth Management, adds his support for an independent community, saying: “Never underestimate having a truly independent voice providing comments and views on what they see when they look under the hood of your business. When we were at a crossroads, Kon and the team provided timely counsel on the path we needed to take – or risk blowing ourselves up.”

Costas says: “In addition, we are seeing many businesses taking a deep breath for the first time in a few years, and begin looking for more opportunities to grow organically, succession planning, mergers, acquisitions, scale, and, most importantly, how to successfully support their staff through the highs and lows.”

Other key members voicing their support of how important it is to have access to the wealth of knowledge and experience on offer from The Principals’ Community include Glenn Calder, CEO, Viridian Advisory. “We see people working together, sharing, and collaborating as the pinnacle of how we can improve.”

Anthony Kapetanovic, Managing Director, Akambo Financial Group, adds that in a post-Royal Commission world, AFSL holders will require more guidance.

As the need for quality financial advice continues to increase, especially following a volatile 18 months with regulatory oversight remaining a topical issue, The Principals’ Community is focussing on bringing back in-person gatherings around the country and prioritising several offerings advisers want. These include:

• an industry benchmarking report now in its 3^rd year, provides sought-after data sets enabling principals to readily compare their key ratios to likeminded and similar size self-licensed businesses
• the running of several educational and professional development masterclasses, and
• providing governance support and ensuring licensees understand all regulatory and legislative requirements, delivered through a mixture of quarterly meetings and ongoing engagement with Responsible Managers.

Costas says: “For us, 2022 is a year to achieve two things: resuscitate a core value of the community that is peer-to-peer learning and conversation via face-to-face forums. The 122 businesses all have a wide array of experience and expertise covering everything from technology, research, business management, structures and M&A or product/platform related questions that can be shared with their peers.

“Secondly, opening the door for prospective self-licenced businesses to join the community and connect with like-minded businesses and individuals independently of any concerns surrounding conflicts of interest.”

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The Principals’ Community headed up by Kon Costas has been formed as an independent and dedicated self-licensed offer with the objective of providing enhanced services and support to meet the demands of successful self- licensed businesses.

The newly formed community has evolved from the BT’s Practice Principals’ Community after BT and Costas decided to part ways in the new post Financial Services Royal Commission era where adviser independence has become a highly valued commodity.

The BT Community had 134 members (authorising over 1300 advisers with over $50 billion funds under advice) comprising many of the elite advisory businesses from across the country. Costas is confident that with his key team members joining him, and the overwhelming support from the current community for the independent model coupled with the continuity of the services and support will attract businesses to join The Principals’ Community.

Costas says: “I am thrilled by the opportunity to build on the existing foundations of the successful community and provide quality advice businesses the framework that facilitates the connectivity of business leaders to share insights, learning, challenges and opportunities. In addition, the community has a strong focus on the ongoing professional development of advisers where they   gain fresh insights in advice strategies, and a better understanding of the practical application of the regulatory and legislative environment through our dedicated governance team.

“The need for quality financial advice has never been more pronounced at a time when markets are volatile and regulatory oversight has never been more demanding of advisers. The Principals’ Community sees its mission as helping its members in these difficult times.”

To align itself with the growth-orientated quality businesses that comprise its membership, The Principals’ Community has three core pillars to ensure a constant value proposition. They are:

• a community mindset allowing for likeminded self-licensed businesses to come together and benefit from peer-to-peer learning
• a highly experienced governance team providing commercial support in managing licences and adhering to best practice, development regulatory updates, and
• scalability and ability to leverage off selected third party service providers including advice technology, education and research to name a few,

“Following the Royal Commission, requirements from AFSL holders have become much tougher, resulting in licence holders increasingly engaging with their peers for support and business insights into how to scale their businesses.

Establishing a self-licensed model independent of an institution also removes conflicts of interest and risks surrounding breach reporting obligations and provides licence holders the services and support to evolve with the ever-changing landscape,” he says.

A BT spokesperson says: “We have decided to close our Practice Principals’ Community from 10 December 2021 to focus on our core platform’s capability, technical and strategy support through our technical team and a series of events and masterclasses planned throughout the year.

We wish Kon and his team all the very best with his new venture and look forward to engaging with The Principals’ Community.”

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Butterworth formed and led DKN Financial Group for more than eight years before leaving last month and has a wealth of experience as a senior executive in the financial services industry. With an 18 year career spanning distribution, platform development, dealer services, business acquisition and integration, he has previously worked in senior roles at Macquarie Portfolio Services, Lonsdale Financial Group and Asgard. 

Modica has been chief executive of Lonsdale Financial Group since 2000 and has a long history in the banking and finance industry including senior roles with Westpac, J.B.Were and National Australia Private Bank. Costas, whose career has spanned banking, financial planning, wealth management, business coaching and financial services dealership network development and recruiting, was the executive director of Lonsdale Financial Group which he joined in 2005. Rutter has been executive director for distribution at DKN Financial Group for the past six years where he has been responsible for the strategic direction of the distribution business, building on his previous senior distribution roles with Wizard Home Loans, AXA Australia and National Mutual. 

The appointment of Butterworth, Modica, Costas and Rutter is part of a strategy by BT Financial Group to continue to lead a market that is transforming as a result of a changed regulatory framework and growing consumer demand for sound strategic advice. 

BT Financial Group’s General Manager of Advice, Mark Spiers, said a highly disrupted market is driving many financial advisers to reconsider their future. 

“Advisers who want highly successful and sustainable businesses are now looking at who they should partner with for the next decade and beyond. 

“While we continue to attract planners into our salaried work force to ensure our banking customers receive quality financial advice, we want to ensure we are best positioned to continue attracting those advisers into our aligned channels who want to partner with a high quality brand with sound strategies and an unquestionable focus on clients and leadership.” 

Spiers said the business’ mandate is to deliver business solutions to advice practices which help them utilise the scale advantages available from working with the broader BT Financial Group. 

“When combined with business expertise and a strategic perspective, this scale can help practices be more efficient, drive growth and, ultimately, improve their bottom line. 

“It’s a very exciting time and we look forward to welcoming Phil, Mario, Kon and Andrew next year to help build on our heritage of industry leadership, product and service innovation, deep client relationships and quality in everything we do,” Spiers said.

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