Sign up for the new Globe Advisor weekly newsletter for professional financial advisors on our newsletter sign-up page. Get exclusive investment industry news and insights, the week’s top headlines, and what you and your clients need to know.
A proposed Canadian content law could affect financial advisors who use news content in their communications with clients because they may need to ensure the marketing technology companies they use are paying for the content they supply.
In April, the federal government introduced Bill C-18, known the Online News Act, designed to ensure that news media and journalists receive fair compensation for their work.
The bill gives tech platforms, such as Facebook Inc. and Google LLC, six months to strike commercial deals with outlets for the news they share, allowing all media organizations, big and small, to bargain collectively.
Many Canadian advisors leverage this content across their marketing activities to provide context on current wealth topics using one or more technology platforms to automate social media posts, website content and scheduled e-mails. That means the new law will hit at the heart of activities related to the retention and growth of their client base.
In a recent AdvisorStream Ltd. survey, Canadian investors rated news content as their most trusted source of financial information. Fact-checked content is valued particularly, with 85 per cent ranking it as “very important.” Another 85 per cent said fact-checked content was essential to their investment decision-making process.
Furthermore, survey participants said a key way for advisors to add value was to provide further education on emerging trends and financial topics.
With advisors being a natural conduit for financial education, there are some steps they can take now to ensure their practice is prepared best for the impending bill.
Taking stock of marketing efforts
Advisors can start with an audit of how their firm uses content in marketing activities such as on social media, in newsletters, e-mails, and on their websites or blogs.
They’ll also need to identify how third-party content is used, especially if it’s a resource to complement their own material. Once this content has been identified, advisors will need to determine whether their firms and marketing platforms have explicit permission or a licensing agreement in place to distribute the content.
How advisors go about this will depend on the type of advisory business they operate.
If an advisor is working with a bank-based brokerage or another national firm network that provides all their content and tools, it’s as easy as checking with the head office to confirm the content and marketing tools are in compliance with the Online News Act.
However, if an advisor works within a network that gives them the freedom to choose their own content and technology platforms, they will need to ensure the vendors they select are compliant with the law by confirming a licensing agreement is in place.
If a vendor is not compliant with the new bill, it’s important to learn what their plan is to ensure compliance. If the vendor is unable to negotiate a contract, advisors may need to find a new provider.
The government has stated that there will be a six-month grace period after the bill becomes a law for tech vendors without licences to negotiate and become compliant.
Overall, news is important to clients and for their advisors. Fact-checked content is a key resource for education, prospecting, and ongoing communication. For advisors, specifically, supplying content is becoming an increasingly critical part of day-to-day operations. They need to ensure they and their providers are on the right side of the new regulations.
Kevin Mulhern is co-founder and chief executive officer of AdvisorStream in Toronto, a division of Broadridge Financial Solutions Inc. that provides a digital marketing platform for advisors.
For more from Globe Advisor, visit our homepage.