Consumer Duty is transforming consolidation in financial advice, forcing buyers and sellers to prioritise cultural fit, client outcomes and long-term integration over deal size, according to industry leaders at Money Marketing Interactive London.
A panel featuring Emma Napier, consulting director at NextWealth; Louise Jeffreys, managing director at Gunner & Co; and Victoria Hicks, group chief executive at Melo, said consolidation remains robust but is entering a more mature phase shaped by regulatory scrutiny and shifting investor priorities.
Hicks noted that much of the private equity investment in the advice sector between 2019 and 2021, around 70% of deals, occurred before AI and Consumer Duty changed the market.
“Many of those firms are now nearing the end of their investment cycle, and new investors bring different objectives. That can cause stalling at times,” she said.
She added that some large consolidators lag behind smaller firms in AI adoption because it was not part of their original business model.
Jeffreys said Consumer Duty has raised expectations on both sides, increasing transparency around integration and client outcomes.
“Post-sale, there must be alignment around fees, systems, and client care. Buyers must clearly show how they will deliver positive outcomes, and that is a good thing,” she said.
Napier added that private equity firms are also evolving.
“Consolidators are increasingly focused on governance, infrastructure, and culture. Some use other portfolio businesses to strengthen advice groups, adding real strategic value.”
The panel agreed that Consumer Duty is shifting consolidation from a scale play to a values-driven model, where seller motivations, client experience, and post-deal integration define success.
Planning for succession
The panel stressed early planning and transparency for advisers considering selling or succession.
Jeffreys said advisers should define objectives for themselves, their teams, families, and clients.
“Write down your goals and review them with a trusted adviser. Some objectives may take five years to achieve, others may never happen. It is better to adjust your mindset early than be disappointed later.”
Napier highlighted the importance of honesty for both buyers and sellers. Sellers need accurate data and up-to-date suitability reviews, and buyers must be clear about culture, systems, proposition, and what it is like to join them.
“Many deals fall through because these conversations do not happen early enough,” she said.
Jeffreys added that advisers should seek references from buyers who have completed previous acquisitions to understand how they delivered on their promises.
Hicks urged firms to start planning sooner rather than later.
“Selling a business is challenging, especially with regulatory scrutiny. Conducting a business and personal readiness assessment helps you spot gaps early, build confidence, and make improvements before due diligence. Time can be your friend or enemy depending on how well you prepare.”
