Editor’s Note: This post was originally published in April 2023 and has been completely revamped and updated for accuracy and comprehensiveness.
It may make sense for you, as an independent financial professional, to partner with an Office of Supervisory Jurisdiction (OSJ) to help you manage the day-to-day tasks of your financial advisory practice.
Selecting the right OSJ for your needs may also be one of the most important decisions you can make for your practice.
An OSJ can serve as your firm’s compliance and regulatory arm. It should be responsible for monitoring the activities performed by all parties within your organization and can also assist you with marketing services and business succession planning.
That’s why, when making this selection, you want to make an informed, objective decision.
To help ensure that you choose the right fit for your business, we have compiled seven important questions every financial firm should ask when interviewing potential OSJ partners before making a final decision.
This article discusses the following questions:
- Do we share the same values and goals?
- What sort of training and education do you provide to advisors/firms?
- How are you compensated?
- What is your compliance philosophy and process?
- What type of technology platforms do you offer?
- Do you offer new advisors transitional services?
- What level of autonomy will I retain?
1. Alignment of Goals and Values
As an independent financial advisor, you should ensure that your business goals and values align with those of an OSJ before partnering with one. This includes assessing the OSJ’s commitment to providing you with tools for growth and innovation and how they support you by providing the highest level of client service using industry best practices.
Consider the OSJ’s overall culture and values, including its approach to client service, transparency, and ethical standards.
A strong partnership will be based on shared values and a compatible culture, so ensuring that the OSJ aligns with your beliefs and practices is essential for your long-term success. A strong partnership with your OSJ fosters better collaboration and support for your firm.
2. What Sort of Education and Training Do You Provide to Financial Advisors/Firms?
The OSJ should offer ongoing training and educational resources for its financial advisor base. Evaluate the quality and accessibility of these resources and the likely service partner’s commitment to ongoing professional development.
A good match could also result in a deeper understanding of compliance regulations, learning about new products and investment strategies, and improving their overall professional development. Improving your overall professional development can boost your credibility and reputation in the industry, ultimately increasing client satisfaction and retention.
3. How Are You Compensated?
OSJ compensation is typically based on a percentage of the revenue generated by the branch offices they supervise, known as an override fee. For example, if a branch under the OSJ’s supervision earns $100,000 in commissions, the OSJ might receive 1-5% of that amount.
Some OSJs charge a flat or administrative fee for their supervisory and compliance services. This fee helps cover the costs associated with their oversight responsibilities.
The third way an OSJ may be compensated is based on the performance or growth of the branch offices they oversee. This can include bonuses or other financial incentives for meeting certain targets or objectives.
Financial advisors who move their back office to an OSJ can experience numerous benefits, including reduced operational and compliance burdens, increased efficiency, access to cutting-edge technology platforms, and a comprehensive suite of resources tailored to help them grow their practice.
At Evolution Financial Advisors, we believe in full transparency, so you will always know what you will be paid and what you are paying for. Transparency in an OSJ partnership is of the utmost importance.
By leveraging the expertise and infrastructure of an established OSJ, you can focus on cultivating client relationships and providing exceptional service, ultimately enhancing your overall profitability and success in the industry. However, you’ll need more than this over the long haul.
Your OSJ partner should be as upfront and transparent as possible. It shouldn’t be difficult to understand how you’ll be compensated, what you’ll receive, and what you’ll be paying for.
4. What Is Your Compliance Process?
The Office of Supervisory Jurisdiction (OSJ) can play a crucial role in ensuring compliance and oversight within your financial advisory practice. Through ongoing monitoring and enforcement of regulatory standards, your OSJ should provide you with a robust framework that benefits your firm in multiple ways.
An OSJ can help you maintain your professional integrity and credibility in the eyes of clients and regulators by facilitating adherence to established rules and guidelines.
OSJs can also help you remain compliant with ever-evolving regulations if you are an independent financial planner. Additionally, OSJs offer ongoing support and training, informing you and your team about industry trends, best practices, and regulatory updates.
This comprehensive compliance and oversight process safeguards the interests of your clients and advisors alike and fosters a more transparent and trustworthy financial services environment.
Unsure How To Find the Best OSJ for Your Firm? We’ve Got a Guide To Selection Here
5. What Type of Technology and Infrastructure Do You Offer?
Did you know that OSJs can offer you and your team of financial advisors a significant advantage in terms of access to cutting-edge technology platforms and infrastructure? These advanced tools and technology platforms can streamline operations, facilitate communication, and enhance your practice’s efficiency.
By partnering with an OSJ, you can access sophisticated platforms for portfolio management, financial planning, risk assessment, and compliance monitoring. This allows you to make better-informed decisions, provide more comprehensive services to your clients, and stay ahead of your competition in the rapidly evolving financial services landscape.
Additionally, having a robust technology infrastructure provided by a service partner that the OSJ oversees can alleviate the burden of managing complex IT systems for independent financial advisors. OSJs are constantly looking to upgrade technology solutions and provide access to teams that help maintain and upgrade them, ensuring that you and your team have continuous access to the latest tools and features.
This means you can focus on what you do best—providing high-quality financial advice to your clients—without worrying about technology management or the costs associated with implementing and maintaining these systems.
In this way, an OSJ provides valuable support and resources that, as an independent advisor, you may need help accessing. This can promote a higher level of service and client satisfaction.
6. Do You Offer New Advisors Transitional Services?
If you are considering leaving your current employer and transitioning to become an independent financial professional, you must address many challenges and hurdles during this process. When interviewing OSJs, it’s important to understand what types of transitional and onboarding services they provide.
- Better OSJs help streamline the process by offering access to cutting-edge technology platforms, trading and investment tools, research, and CRM systems.
- Quality service partners also facilitate ongoing training, coaching, and mentoring to help advisors develop their skills and grow their businesses. This comprehensive support enables you and your team to focus on building strong client relationships while the OSJ handles the time-consuming complexities of running an independent practice.
- A good OSJ will also provide a customized transition experience. You must ensure that things go as smoothly as possible.
By carefully considering these questions, you should find an OSJ partner who will help you thrive, maintain compliance, and deliver exceptional service to your clients.
7. What Level of Autonomy Will I Retain?
One of the most critical considerations when partnering with an OSJ is how much independence you will have in managing your business. For many advisors, their brand, client relationships, and decision-making processes are cornerstones of their success. Before committing, clarifying how the partnership will impact your ability to operate as you see fit is essential.
Your level of autonomy directly affects your ability to run your business in a way that reflects your unique values, goals, and client service standards. Some OSJs offer flexibility, allowing you to retain significant control, while others may impose stricter guidelines or processes. Understanding these dynamics upfront ensures the partnership enhances rather than limits your practice.
Why Partner with Evolution Financial Advisors?
As an independent financial advisor, you value your autonomy and the ability to tailor your business to your clients’ needs. Partnering with Evolution Financial Advisors (OSJ) allows you to retain that independence while gaining a well-established supervisory organization’s resources, support, and expertise.
Here’s why independent financial advisors choose Evolution Financial Advisors:
• Compliance Made Simple: Managing compliance can be overwhelming. Evolution Financial Advisors provides robust support to help you stay ahead of regulatory requirements, freeing up your time to focus on clients.
• Cutting-Edge Technology: Access to industry-leading platforms for CRM, financial planning, and portfolio management ensures your practice runs efficiently and delivers a top-tier client experience.
• Customized Marketing Support: Retain your brand identity while benefiting from guidance on marketing materials and strategies that align with your business vision.
• Practice Growth Resources: From lead generation to succession planning, Evolution Financial Advisors offers tools and mentorship to help you expand your practice and achieve long-term success.
• Collaborative Community: Join a network of like-minded professionals who share best practices, offer peer support, and contribute to a culture of shared success.
By partnering with Evolution Financial Advisors, you get the best of both worlds—independence in running your business and the backing of a trusted OSJ that prioritizes your growth and success.
Ready to learn more about our OSJ services for independent financial professionals? Connect with us today.
