§ IV — Industry Framework Financial Advisory & Wealth Management Version 1.0
The Financial Advisory & Wealth Management Industry Framework
Financial advisory and wealth management firms operate at the intersection of three pressures: client demand for AI-enabled portfolio analytics and personalised advice, regulatory exposure under conduct-of-business and suitability regimes, and the institutional duty of fiduciary care. The Raydorf Financial Advisory and Wealth Management Framework adapts the seven dimensions of the Standard to these pressures.
§ I Evaluation
What the Financial Advisory Framework evaluates
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Strategy & Leadership
Managing partner or executive committee accountability. AI strategy reviewed by the firm's leadership and compliance function on a defined cadence. A named individual responsible for the firm's AI programme, with reporting to the firm's risk and compliance committees.
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Governance, Risk & Compliance
Written AI policy aligned with applicable conduct of business rules (MiFID II Article 25 on suitability, IDD where relevant), the EU AI Act, and the firm's fiduciary obligations. Risk classification of AI use cases against suitability and best-interests duties. Engagement letter language addressing AI involvement in advice and recommendations.
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Data & Knowledge Infrastructure
Client-level sensitivity labelling. Retention discipline aligned with regulatory record-keeping obligations (MiFID II record-keeping requirements; equivalent local regimes). A queryable institutional knowledge base populated through a defined client-review-close process. Demonstrable separation of client data across mandates.
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Workflow Redesign & Operations
Identified workflows where AI is the default first pass — typically portfolio analytics, market research, suitability screening, client onboarding documentation, and the drafting of client-facing recommendations. Documented before-and-after metrics tied to suitability outcomes and client-reporting quality.
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Talent & Operating Model
AI fluency across advisory professionals and operational staff. A designated operator role for the firm's AI infrastructure. Hiring and progression criteria that reflect AI-era competencies. Defined training cadence covering both capability and the specific obligations of fiduciary practice.
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Client Experience
Disclosure practice for AI involvement in advice and recommendations, calibrated to the firm's suitability and best-interests obligations. Client-facing AI features where appropriate. Demonstrable improvements to suitability documentation, transparency, and client-outcome reporting attributable to AI maturity.
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Measurement & Accountability
Performance and suitability-outcome metrics tied to AI use. Logged human oversight on AI-assisted recommendations, in a form that supports the responsible adviser's sign-off. An audit trail sufficient to reconstruct AI involvement on any client recommendation, at any time, in support of regulator inspection or client enquiry.
§ II EU AI Act
EU AI Act considerations specific to financial advisory practice
Of the four sectors the Institute currently certifies, financial advisory engages the EU AI Act's high-risk regime most directly. Annex III explicitly identifies as high-risk those AI systems intended to be used to evaluate the creditworthiness of natural persons or to establish their credit score, and AI systems used for risk assessment and pricing in respect of life and health insurance. Firms whose work touches credit assessment, certain insurance underwriting, or related functions in private banking and wealth structuring may engage the high-risk regime directly. The framework includes specific screening criteria for these uses, and the EU AI Act Readiness Attestation evaluates the firm\'s response to them with particular care.