The Fiduciary Rule: A Communications Case Study

Dealing with breaking news or events that affect your organization is key to any successful communications program.

But anticipating and planning for such events – rather than just reacting – can create opportunities and help your firm communicate professionally, improving perceptions among customers and competitors.

The recent release of a final fiduciary standard by the U.S. Department of Labor is an example of a news event that created opportunities and challenges for retirement advisors and organizations in the retirement industry. Those coming out ahead were able to anticipate and map a strategy in advance.

The DOL’s Fiduciary Rule, which begins to phase in next April, establishes stricter standards on investment advisors who are compensated for their advice, requiring them to recommend what is in the best interests of clients when they offer guidance on retirement plans. Under current rules, some financial advisors – mainly those employed by broker dealers or insurance companies – are held to a lower standard, requiring their recommendations only to be “suitable.”

The new standard had been discussed for several years and was heavily debated in public testimony and written comments prior to issuance. Stricter standards were widely expected; the details and implementation were of broad interest, especially considering how much was at stake. The retirement services industry stands at $25 trillion and the DOL estimates that conflicts of interest among advisors cost U.S. investors $17 billion per year.

The months and weeks leading up to the April 6 ruling were filled with speculation among financial advisors, other professionals who offer financial advice, politicians and journalists who cover the financial services industry.

Coverage of the rule was widespread. There were hundreds of news articles and commentaries on such topics as potential requirements for financial advisors and the fees they may charge, the costs for complying with the new standard and the possibility that some smaller investors might lose access to financial advice because of those higher costs. Daily financial newsletters kept up the pace and social media played a huge role in building awareness. Among the benefits of the advance coverage were huge increases in their readership and web traffic.

Meanwhile, well prepared financial advisory firms and retirement savings industry associations were able to use the advent of the news to communicate to their important constituencies.  Some issued news releases as the expected date for the rule announcement drew near, to let their clients or members know they were preparing for the new standard and would analyze the ruling and its impact as soon as possible after it was issued. Some prepared materials to be shared via email or on websites or distributed to news organizations as soon as the rule was released, assuring their clients and audiences that they were on top of the new standard, and protecting their interests. These organizations and their experts were called on by media as the news broke.

And indeed, when the new standard was finally released, the announcement unleashed a torrent of coverage, analysis, commentary and social media. As noted by Frederick P. Gabriel, editor of InvestmentNews, the rule’s release created an “adrenaline rush” that spread through the newsroom and lasted for a week. Gabriel’s magazine and web site, which had extensive advance coverage for months before the ruling, followed up with multiple cover stories, dozens of articles, commentary and slideshows that examined the rule and its likely impact in detail.

The Twitter hashtag #fiduciary tracked review and analysis from advisors, politicians, retirement associations and others, revealing diverse views on the new standard.

News and events as significant as the Fiduciary Rule are relatively rare. But significant industry news offers opportunities to let your clients and customers know you are prepared to take action on their behalf.  To prepare to communicate about a major event such as the Fiduciary Rule, we suggest you follow these steps:

  • Get your arms around the issue.
  • Identify what you have to say about it.
  • Ask yourself who needs to know about.
  • Determine what and how you want to tell your various constituencies – employees, customers, the community or industry, media.
  • Determine who your spokesperson or spokespeople should be.
  • Craft your communications
  • Move quickly to share your communications in multiple ways – via email, letter, website, news release, or social media.
  • Make sure your experts are available to communicate with customers or participate in interviews.