If you consider yourself an independent financial adviser, your clients may not completely agree.

So indicates new research from Oaks, Pa.-based SEI. The research shows that nearly three out of four investors regard “independence” as important or somewhat important. But many investors believe that independence in a wealth industry relationship remains “more a hope than an expectation,” according to SEI.

In fact, investors often don’t even know what the term “independent” really means, says Jim Morris, senior vice president of SEI’s global wealth services division.

“Don’t throw that term (independent) around,” he advises. “Clients may not understand it, and they’re inherently skeptical coming out of the events of 2008.”

SEI’s study is based on in-depth interviews comparing the views of 250 private clients and wealth management providers, including banks, independent trust companies and investment advisors, on the issue of independence. 

Among the findings was the result that only one in three investors believes independence is attainable. Meanwhile, 87% of wealth management providers believe achieving independence is business-critical, and 72% of investors believe independence is important or somewhat important.

One of the key findings is that investors and wealth managers simply don’t agree about the definition of independence. Among its possible meanings, wealth managers rank “no product pushing” first, while “enhancing business controls” tops the list for investors.

Investors “don’t really expect a wealth manager to have no affiliation with any of the products they promote, for example,” says Morris.

The report did find that investors understand that establishing and consistently delivering independence is not easy for wealth management providers. And it revealed that investors do realize fees and commission on product selection are an impediment to achieving independence.

Very few investors and even fewer wealth managers polled are calling for a solution where investors pay advisory fees, according to SEI. But the research points to shareholding structures, reporting lines, and internal fee-sharing agreements as possible steps wealth managers can consider taking to achieve lasting independence.

It’s unclear how the perceptions of fee-only, open-architecture advisers and their clients might differ from the universe that SEI’s report focused on; the results are not broken out by segment.

Morris says he hopes that detailing the understanding gap between advisers and clients will better equip wealth managers to address it. Advisers can improve their client relationships by communicating clear strategies for accountability, corporate controls, compensation and commissions, he added.

“Advisers should not assume that clients understand how they’re offering independent advice and solutions,” says Morris. “Investors want to be educated—in a plainspoken way.”

SEI’s report is part of “Independence: The Right Standard,” part of a series examining the changing relationship between wealth managers and investors in the global market.