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SD-15.12 — Client Advice & Suitability

Business Domain: BD-15 Distribution, Product & Client Management (Commercial) · Applies: BOTH

Purpose

Assesses the suitability and appropriateness of what a client is sold or holds, and runs the regulated advice process. SD-15.12 is the regulated suitability gate: it profiles the client’s objectives, risk tolerance and circumstances, assesses whether a product or portfolio is suitable for that client, and runs the advice process under the suitability rules. It is a wealth-manager activation — an institutional manager executes a mandate, it does not advise. Its scope is the suitability control, deliberately: the wealth manager’s broader value proposition — comprehensive financial planning, estate and wealth-transfer planning, goals-based advice — is SD-15.15 Financial & Wealth Planning, a separate Service Domain; SD-15.12 gates what an SD-15.15 plan recommends. It is not investment-guideline compliance — BD-10 checks the portfolio against the rules it must obey — and it is not the mandate definition (SD-01.2); SD-15.12 advises the client on what suits them.

Service Operations

  • Profile the client — assess and record the client’s objectives, risk tolerance, capacity for loss, knowledge and circumstances.
  • Assess suitability and appropriateness — assess whether a product, portfolio or recommendation is suitable for the client, and whether a product is appropriate where advice is not given.
  • Run the advice process — provide the financial advice and produce the suitability report and the advice record.
  • Review suitability over time — periodically re-assess suitability as the client’s circumstances and the portfolio change.
  • Govern the advice standard — maintain the firm’s advice and suitability standards and the consumer-outcome obligations.

Inputs and outputs

  • Inputs: the client profile and circumstances; the product range from SD-15.3; the portfolio and performance data; the suitability regulation.
  • Outputs: the suitability assessment, the advice record and the suitability report — consumed by the client, SD-15.13 and SD-14.2 (the conduct and Consumer-Duty evidence).

Entities

  • Consumes: E-01 Legal Entity (the client), E-03 Portfolio / Mandate, PM-01 Fund & Vehicle; the SD-15.3 product range; E-33 Financial Plan (from SD-15.15 — the comprehensive plan whose product recommendations the suitability gate is applied to).
  • Owns: the client suitability profile and the advice record — a process artefact; part of the Client / Investor entity.

Standards

  • The MiFID II suitability and appropriateness requirements.
  • The FCA suitability regime and the UK Consumer Duty consumer-understanding and consumer-support outcomes.
  • The US Regulation Best Interest and the fiduciary-advice rules.

Open extensions

  • The suitability-assessment sub-model.
  • The client-profiling sub-model.
  • The Service-Operation-level input/output contracts.

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