Goodreturns has news that restraints of trade, common in professional services, are often not enforceable. The main problems appear to be with how specific they are, and the scope. The trick is to be very clear, but also to be as limited in scope as you can. Put it the other way, your restraint of trade is unlikely to be enforceable if you are vague, and seek to prevent the adviser from ever contacting a client anywhere.
So far, so normal. But this has implications for business operations and value when sold. Imagine a business with 20,000 clients, handling a broad range of investments, Kiwisaver, and insurance advice services.
In CorporateCo the business is organised so that there is a high level of brand presence, a great website, good central records of clients, nice newsletters, a good programme of covering advisers so that a client is a client of the business, not the individual adviser who gave the advice.
In CollegiateCo the business is a small core of central services and advisers pretty much run their own groups of clients, their own name dominates the corporate brand, correspondence is primarily driven by each adviser and 'their' administrator.
Restraints of trade look very important in the second case, and less so in the first. When trying to sell these businesses CorporateCo looks more valuable - everything else being equal.
The implications for takeovers is different. You very often don't get to decide which kind of business you buy. Often those businesses for sale are not as well organised as those buying - when you think about it, that's logical - so assume you buy something more like 'CollegiateCo' - what do you do? You can work hard to retain the advisers as long as possible. You can put in a reasonable restraint. But more than those, you must add the things that were missing in the first place: adding so much value that even if an adviser leaves and tries to take lots of clients from you, they find that hard. It also helps to be a little philosophical about things, some clients will never stay.
There aren't actually many big financial processes where you need to sign scary declarations. Getting a 'wet signature' on a declaration is actually, when you think about it, a pretty bad sign. When you need to remind someone of how terrible the legal or financial consequences of something are, that suggests some other process may not be working too well.
To illustrate: after the initial scary declaration when I signed up to buy and sell shares online with my bank, I now do not need to do that. I know, and they know, that when I buy or sell some shares I am already aware of what that means.
So, given that I can process big trades without scary declarations now, if I am confronted with scary declarations I am thinking: gee, this really must be scary and big, or, why are they asking me for this? For consumers unfamiliar with the ways of financial services, signatures are even scarier - after all, most people don't know what the declaration they are signing means.
We are aware that Partners Life offer a TPD Booster Benefit on their Income Protection products. We currently do not offer this option on Quotemonster therefore we lack the ability to add the QPR score for TPD booster. It is something we are possibly looking at adding in the future and we will let you know once it is live.
Stats NZ has a nice new report, complete with a couple of infographics, about regional economies. Good economic data is an essential ingredient in robust multi-year business planning for businesses with scale. You can get more detail at this link.
The Cancer Treatment Benefit is an add on to AIA REAL Trauma, that provides up to $500,000 per year for specialist consultations and diagnostic tests (including oncologist consultations, diagnostic imaging and tests and laboratory tests) for the diagnosis of cancer. Should cancer be diagnosed, it provides access to Non Pharmac-approved treatments and the latest Medsafe approved Cancer Immunotherapy medicines.
Must be taken with $100,000 of REAL Trauma. In addition to the Cancer Treatment Benefit an Optional Specialists and Tests benefit is available covering up to $5,000 per year for specialist consultations and diagnostic procedures for all conditions.
I recently attended an ethics workshop hosted by Professional IQ. The last time I had formal ethics training was during my MBA course, a few years ago, and was interested to see what is being taught now. It was a good little course covering basics with about four of us in the room and the same joining online. In the end, for me the session left us with three important points:
Have a formal, written, process for checking the ethics of a situation of concern
Run your answers past someone you respect who has no financial or professional stake in the situation other than to help you
Keep a record
Although we used a different model in the workshop, the approach below was mentioned and when I looked it up later, I thought this is better. It is the Twelve Questions Method developed by Laura Nash. See this reference for details.
Have you defined the problem accurately?
How would you define the problem if you stood on the other side of the fence?
How did this situation occur in the first place?
To whom and what do you give your loyalties as a person and as a member of the company?
What is your intention in making this decision?
How does this intention compare with the likely results?
Whom could your decision or action injure?
Can you engage the affected parties in a discussion of the problem before you make your decision?
Are you confident that your position will be as valid over a long period of time as it seems now?
Could you disclose without qualms your decision or action to your boss, your family, or society as a whole?
What is the symbolic potential of your action if understood? If misunderstood?
Under what conditions would you allow exceptions to your stand?
A traumatic account of a troubled patient who appeared to change their mind about an assisted dying procedure has raised questions at a time when the Netherlands is debating a change in their euthanasia law. Link. Having said that, a Judge was satisfied that the doctor had acted in good faith and the investigation was closed. My view is that having a law for assisted dying would generally result in much less harm than the current approach. This case is a reminder that within that equation some harm may still occur.