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By Francis Chung, executive chairman, MPF Ratings

MPF Rating will release full results from the Employers’ Federation of Hong Kong (EFHK) sponsored 2021 MPF Employer Expectations Survey through Human Resources Magazine next month but  a snippet reveals that now may be an opportune time for Hong Kong employers committed to improving employee financial wellness to offer employees access to investment advice services.

A combination of consecutive years of double digit MPF industry returns, increasing MPF contributions and the compounding return benefits now sees the average MPF account balances exceed HK$270,000 and it’s also growing exponentially.

Despite this growth, the MPF Expectation Survey reveals there’s a disconnect between rising retirement wealth and investment knowledge with over 41% of the 700+ employer respondents claiming that “choosing the right investment fund(s)” was the second most common area employees sought clarification from HR.

The most common predictably was form filling. Filling the advice gap may become the new wellness, but in Hong Kong searching for the right advice can be a case of careful what you wish for. Caveat emptor.

Hong Kong’s financial services industry adopts a multi-regulatory licencing regime resulting in the term “financial advisor” being possibly used by representatives of insurance, bank and securities regulated entities.

Ambiguous to non-investment professional, but in simple terms, it’s primarily only those who are licensed through the Securities and Futures Commission (SFC) to carry on Type 4 (i.e. advice) “regulated activity” who can offer advice on “choosing the right investment fund(s)” within an MPF scheme.

While potentially confusing, don’t let the multi-regulatory regime deter your commitment to employee financial wellness. A good advisor will be licenced by multiple entities and therefore should be able to offer holistic, and independent, advice but remember it’s primarily only those who are licenced by the SFC who can offer a comprehensive answer for respondents seeking advice on choosing the right investment fund(s).

For protection from unlicenced advice go the SFC’s public register of licenced persons to see if an advisor is appropriately licenced.  This simple search may prove to be the best advice ever offered.

EFHK’s MPF Expectations Survey is an input into choosing the MPF industry’s Employers’ Choice winner which will be announced at 5pm on the 4th of March at “The MPF Awards”; an original production which brings hilarity and relevant MPF learnings to its audience. To enjoy a laugh and learn more about MPF please register here.

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