UP CLOSE WITH JOHN COWAN
John Cowan has revived the fortunes of Sesame Bankhall Group. Despite his long career, he has no plans to hang up his hat from a profession brimming with opportunity, as Jennifer Hill found out.
Back in 1968, John Cowan was a 21-year-old labourer in the Glasgow shipyards having grown up in tenement housing in the city. A career change into financial services as a broker consultant with Scottish Amicable seemed an easy move to make.
‘I was pondering my career options whilst labouring in the shipyards during the winter months; a job working in a warm office instantly felt like a far more inviting choice,’ he said.
It is a career that has spanned more than 40 years, 33 of them with Scottish Amicable where he rose to the role of sales and marketing director and took a position on the board. He became group sales director after Prudential bought Scottish Amicable in the late nineties before leaving to work for National Australia Bank, which at the time was looking at opportunities in the UK market.
He took a number of independent non-executive director roles at various financial services companies, including Sesame Bankhall Group (SBG), which he joined in 2009 and became executive chairman in 2014.
His CV might be impressive, but John concedes that he has hit some bumps in the road.
In the late nineties he declined a job offer for a very senior role, as he was uncertain he was up to the task. ‘Subsequently, I know I could have done it – it will always be a source of regret,’ he said. ‘I should have been braver.’
In his mid-50s, he lost out in a restructure at Prudential. At his lowest point he listened to a well-known industry figure, who advised him to accept that he would not hold an executive role again.
‘I subsequently went solely down the non-executive path, but in hindsight I could have continued down both routes. That’s where I am today, but it took a decade to rectify the error. You should listen to your inner voice.’
SBG brings together Sesame, one of the largest and most established adviser networks in the UK; Bankhall, a leading supplier of support services to directly regulated financial advisers; and PMS, the largest mortgage and ancillary service distributor, which John helped found while at Scottish Amicable. Through these three brands SBG reaches 11,000 professional financial advisers, making it one of the largest distributors of retail financial advice.
‘SBG is a fascinating business, offering a wide variety of services to both directly FCA authorised advisers and appointed representatives, which are all delivered by our brilliant staff,’ said John.
He makes no secret of the challenges that the group has faced: a downward spiral began in June 2013, when Sesame was fined £6 million by the Financial Conduct Authority for failing to ensure advice given to its clients in relation to collapsed investment scheme Keydata was suitable. That year the network reported losses of £9.3 million for 2012 – four times its losses for the previous year.
A strategic review of the business saw it withdraw from licensing wealth advisers in its network and shake-up its board; John took a more hands-on role as executive chairman to help devise a plan for the business. The company subsequently moved back into the black.
‘My greatest achievement has been working with the leadership team to stabilise the business and turn it around,’ he said. ‘The business emerging today is a result of years of hard work by many people. The group is now in a strong position to grow and this is reflected in the many positive comments I receive from people across our industry, who can see what has been achieved and the exciting opportunities ahead of us.’
Role of protection
The group continues to support wealth advisers through Bankhall, while increasing its focus on the mortgage and protection sector. In May, it unveiled 20% annual growth in mortgage completions through Sesame and PMS. It now writes one-quarter of all intermediated mortgages in the UK.
This year, it has also been running its Rewire Routines campaign, a charter challenging advisers to make protection a central part of conversations with mortgage customers. It is allied to the British Heart Foundation, so for every adviser who signs the charter, SBG makes a donation to the charity. The initiative is being supported by a number of product providers and has so far raised more than £10,000.
‘Within SBG the whole of the senior leadership team is absolutely passionate about the role of protection, particularly in the mortgage space,’ said John. ‘Wealth customers are alerted to all the potential investment risks, whereas for mortgage customers taking on debt there is no obligation to talk to them in the same way about the risks they are taking on.
‘Protection has historically been the foundation of financial planning, so in many ways we are simply seeking to restore it to its rightful place, which is at the heart of the conversations between advisers and their clients. One of the natural consequences of this focus is that advisers’ protection income has risen exponentially in recent years.’
If he could change one thing about financial services today it would be an end of loaded premium protection products. ‘In a world of greater transparency, I look forward to this,’ he said.
For John, today’s financial advice sector is ‘full of amazing opportunities due to the perfect storm of an increasing supply of people needing professional advice and only a limited number of advisers to serve them, which combined together makes this an incredible place to be’.
‘If you consider a combination of factors in the UK – changing demographics, pension freedoms and wealth tied up in property – what it is telling us is that for the advice profession over the next 20 years, there is going to be an endless supply of people who will require financial advice,’ he said. ‘This is taking place against the backdrop of an advice profession that is getting smaller.’
The challenge is to build a diverse profession that is fit for the future. At a time when technology is having an increasing impact on financial services, another challenge for advisers is the need to play to their strengths and be confident in the advice they deliver – and the customer’s willingness to pay for it.
‘Be clear with your customer that what they are paying for is expert advice; they aren’t paying for sorting out products and carrying out administration,’ said John, whose partner, Gillian, also works in financial services. ‘Advisers should be clear and confident in standing up and justifying the fees they earn. Be confident, proud and play to your strengths.’
John’s goal over the next few years is to continue to deliver the strategic plan set out for the group. A longer-term objective is to develop a succession plan that enables the father-of-two to hand the business on in great shape.
‘I’m 70 years old, but age is just a number and it sounds older than I feel so even after that, I would still like to remain involved with SBG, perhaps in a non-executive chairman capacity.’
Jennifer Hill is a former deputy money editor of The Sunday Times, personal finance correspondent of Reuters and personal finance editor of The Scotsman.
QUICK FIRE Q&A
My first pay packet was...
£600 per year from Scottish Amicable
I’d tell my teenage self...
My ideal job, other than this one, is...
Chairman of Celtic Football Club
Strictly business, I’m most excited about...
The opportunities ahead, because the supply line is secure
The best piece of business advice I’ve ever received is...
Be utterly reliable and professional
My favourite holiday destination is...
The thing or person who makes me laugh is...
People in all their diversity
If I had £1m to spend I would...
If I was Chancellor for the day I would...
Get to work early
I’m passionate about...
The arts; I’ve been collecting paintings for many years and when I get the time I also like to collect first edition novels
I’d describe myself in five words as...
Open, inclusive, talkative, inquisitive, trustworthy