Turning compliance into a competitive advantage

For many firms, compliance becomes a tax on the business rather than part of it. But Kieran McIlwain, the general manager of adviser partnerships at Akumin Advisory, this is a choice, not an inevitability. 

Speaking at the recent InPractice Compliance and Regulatory Expectations webinar, McIlwain has a theory most advisers do not want to hear: the practices bleeding time and money on compliance are doing it to themselves. 

At Akumin Advisory, he spent years inside more than 200 practices and watched the same pattern play out: a regulatory change arrives; the licensee sends a memo, someone creates a checklist, and the checklist lives in a folder nobody opens until an audit.  

Stop bolting it on 

The industry throws the phrase “compliance by design” around loosely. At Akumin, it means something specific. Every obligation gets mapped directly into the advice process, sitting inside the workflows, templates and technology that staff already use every day.

McIlwain’s go-to example is the statement of advice and record of advice question, the one that has been generating confusion for decades. “The number one call into a compliance call centre is: ‘Is it an SOA or an ROA? Do I need to give that ROA to the client? And what goes into that ROA?'” 

That question, repeated endlessly across the industry, is not a training problem. It is a systems problem. Getting it wrong is not a minor issue either; the Financial Services and Credit Panel has banned advisers for systemic failures in this area. “It’s a really serious piece,” McIlwain says. 

Akumin’s solution was to build the decision into a template. Has there been a significant change in the client’s circumstances? If yes, prepare an SOA. If no, does the advice trigger a disclosure requirement?  

The answer tells the practice whether the record of advice goes to the client or stays on file. Support staff know what they need from the adviser; the adviser knows what is expected. Nobody needs to call anyone. 

“Workflows are actions, and we’re trying to replace workflows into a seamless and systemised way of making the right decisions.”

What clean compliance is actually worth 

Here is where McIlwain’s thinking gets interesting. The practices that get this right are not just reducing their risk; they are building more valuable businesses. 

It helps that McIlwain comes from a technology background. Where others see a compliance obligation, he sees a systems problem waiting to be solved. This instinct shapes everything about how he approaches practice efficiency.

Buyers in a merger or acquisition process will go straight to the files. Can they see the previous advice document? Are the consents to receive ongoing fees in place? Is the recurring revenue actually defensible? Practices that cannot answer those questions cleanly will see it in their multiple.  

“The ability to have clean, consistent files in an orderly way that you can provide to a potential buyer absolutely lowers the buyer risk,” he says. “We absolutely see that getting compliance by design right is reflected in, or correlated to, an uplift in your valuation.” 

There is also an efficiency argument that does not get enough attention. Unclear processes mean practices carry more staff than they need.  “I often see too many resources in practice because of inefficient workflows and processes and a lack of capability,” he explains.

McIlwain puts it plainly: fixing the system is fixing the cost line. 

AML is the next test 

The anti-money laundering and counter-terrorism financing (AML/CTF) Tranche 2 reforms, which take full effect on July 1, are the most immediate stress test for any practice. For McIlwain, the approach is no different from any other regulatory change: get it into the advice process before it becomes a standalone burden. 

“As we roll our AML solution out to our practices, we don’t want this to be standalone AML tasks. We want it built into their system in terms of where this fits in the advice process,” he says. 

For Akumin’s network, the licensee absorbs a significant part of the preparation work, updating policy settings, risk assessments and templates centrally before anything reaches the practice level.  

The goal is that by the time an adviser sits down with a client, the AML questions are already part of the discovery process rather than a separate form sitting awkwardly at the end. “If it’s done well, it shouldn’t be too much longer,” McIlwain says. “It should only be a couple of minutes if it’s done well.” 

The adviser-facing message is simpler than the regulation itself. “Our role is simple. We’re really here to make sure advisers and practices continue to see their clients,” he says. 

The part most practices miss 

McIlwain makes one observation that cuts through the noise around technology and process. “Knowing what to do is really important but knowing what you don’t need to do is equally important.” 

Practices with strong systems separating compliance requirements from the client experience do not just survive regulatory change; they come out the other side leaner, cleaner and worth more.  The advisers spending two hours on a file that should take 45 minutes are not working harder. They are working without a system.

McIlwain leaves advisers with a lesson, compliance isn’t a tax on your business. It’s the lever that multiplies its worth. If you treat it as a bolt‑on, you’re bleeding value. Build it into the system, and you’re building equity.