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Best Practices Fiduciary Advisor Affirmation Program Announced


NEW YORK, NY, September 19, 2016 -- Fiduciary advisors will better show investors how they serve clients' best interests -- and investors will better identify such advisors -- under a new and innovative program announced today by the Institute for the Fiduciary Standard.

The program is based on a rigorous, common-sense "code of conduct" developed by the Institute and defines tasks to ensure truly client-focused service that are not required by other advisor groups. It is the first program enabling advisors to demonstrate their commitment to serving clients' best interests announced since the release of the new Department of Labor fiduciary rule in May this year.

"We seek to address the new world for financial advice, in which investors have unprecedented choice and access in selecting services and support," said Knut Rostad, the Institute's president. "Our program will enable advisors to demonstrate that they deserve clients' trust, with guidance that is distinguished by clarity, transparency and honesty in both word and deed."

Luis Aguilar, SEC Commissioner from 2008 to 2015, said, "Regrettably, when it comes to the advisory industry, many investors view finance and financial advisors in a dim light. It's important for the industry to take steps to improve this situation. Subscribing to and advocating for the Institute's Best Practices is an excellent start. Investors will respond well to a firm's commitment to put the client's interests first and to agree to 'common sense' actions. Investors expect such actions to be the norm but, unfortunately, that isn't always the case."

Driven by Institute's Fiduciary Best Practices

Advisors who choose to participate in the "Fiduciary Advisor Affirmation Program" will be required to include the Institute's "Best Practices" statement of Professional Code of Conduct on their website and a disclosure in their legal filing with the Securities and Exchange Commission describing the firm's business (known as the Form ADV). The Best Practices statement of professional code of conduct can be reviewed here: http://www.thefiduciaryinstitute.org/best-practices

Rostad said, "These new practices express, in plain language, concrete duties that make sense to ordinary investors, all focused on how advisors can best demonstrate their total alignment with the client's needs and goals."

Brian Hamburger, CEO of MarketCounsel and counsel to the Institute's Best Practices Board, said, "We've reached a critical point where clients are looking for more clarity on what they should expect from their advisor. And if I were a client, I would want my advisor adhering to the Best Practices. They don't just raise the bar; they follow sound business logic."

"The Fiduciary Advisor Affirmation Program will deliver powerful benefits to investors, advisors and the advisory profession overall," said Rostad. "Investors are undeniably best served when advisors rigorously focus on their interests, and our program will provide them with information for vetting and comparing advisors along those lines. Advisors' commitment to the highest standard for investors will only position them well in an environment where investors more and more consider such advice to be a 'must-have.'

"The more that advisors are generally associated with straightforward, easily understood standards of superior care, the more that investors will look favorably on the profession as a whole and seek out the value that only personally-delivered advice can create," he said.

Complementing Institute's "Campaign for Investors"

The Institute's advisor-focused "Affirmation" program complements its Campaign for Investors, a groundbreaking national initiative launched in May this year to educate and empower investors as well as financial advisors on working together to serve investors' best interests. The Campaign provides tools and resources to educate investors on their rights when working with an advisor, and also offers advisors the guidance they need to best meet their clients' interests and remain essential in an increasingly competitive industry. For more information, visit http://www.campaignforinvestors.org

About the Institute for the Fiduciary Standard

The Institute for the Fiduciary Standard was formed as a non-profit organization in 2011 to provide research, education and advocacy on the vital role of the fiduciary standard for investors and the capital markets. For more information, visit www.thefiduciaryinstitute.org.


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