New research reveals heightened regulation and increased fee pressures are top of mind for advisors worldwide.

Seven in ten financial advisors globally say they will make at least some changes to their business model as a result of new regulations, and close to half say they will need to change their business model in order to sustain business growth, according to a survey by Natixis Global Asset Management.

For a quarter of advisors, the pressure is so great that they would consider selling their practice, merging with another firm, retiring or exiting the industry altogether, according to the survey of 2,550 financial professionals globally. 

Advisors worldwide are expecting a 9.4 per cent jump in business in the next year. Just under half of the growth is expected to come from market action. Three-quarters of advisors believe their growth will come from winning new clients or earning a greater share of business from current clients. 

Meanwhile, 86 per cent of advisors believe their success is linked directly to their ability to manage client return expectations. However, the survey showed room for improvement in this area. Investors expect returns of 9.5 per cent above inflation, while advisors say expectations for 5.3 per cent above inflation are more realistic.

“A concerning two-thirds of advisors worldwide believe investors have a false sense of security about passive investments, and about the same number say investors are unaware of the risks associated with passive investments,” said Natixis.