UBS Wealth Management Americas is encouraging its advisors to broaden links with their clients through its incentive system, The Wall Street Journal reports.

The new compensation structure, sent out to the Swiss firm’s broker force yesterday, rewards advisors for creating financial plans. Advisors receive a payout based on how much they charged for the plan – itself a factor of the plan’s complexity.

"We're not saying to get away from straight brokerage, but to do advising in addition," Jason Chandler, head of the firm's advisors, is quoted as saying. "[Clients] want a holistic wealth management experience and to receive advice on their full financial life."

There are greater incentives for advisors to grow their businesses, as well as to sell products like home insurance and mortgages, thus widening the client relationship, the report says. This offers two key benefits to the bank: more revenue through the sale of such products, and clients who are more “tied in”.

The structure

The basic compensation structure for 2013 reportedly remains unchanged: the highest payout is 48 per cent for advisors with $3 million or more in annual production and the lowest is 31 per cent for advisors generating under $200,000 in commissions and fees.

For advisors creating a financial plan for clients, though, if they charge over $1,000 the payout is 50 per cent plus a 15 per cent credit to their expense account. In other changes, the firm’s “asset award” now includes mortgages and credit lines, the WSJ says.

Reflecting a focus on growth, the “productivity award” has been renamed the “productivity and growth award”, with advisors encouraged to increase revenue by 15 per cent, as this is rewarded with a 10 per cent bonus. On the other hand, if an advisor’s production declines by 15 per cent or more, their bonus will be reduced by 10 per cent.

UBS had not responded for a request for comment at the time of publication.

The changes were initially reported by Reuters.