The growing role of trade associations

This time of year provides a good opportunity to take a step back from the hectic treadmill of day-to-day business and contemplate some of the more high-level questions that we often take for granted.

So, with this in mind, I would like to take a moment to consider why we need trade associations like the ASTL, FIBA, the NACFB and AMI.

The role of a trade association is to represent the collective interests of its members, as well as protect and promote the industry in which it operates. A good trade association should look out for its members by identifying bad practice in the market and ensuring that members behave in a responsible manner. It should also provide input and act as a unifying voice in response to the relevant authorities, so that legislation and regulation is framed so as to protect the consumer, but not to stifle competition and unnecessarily slow down processes. It should offer members market information and insights that help to run their businesses more successfully. 

We are sometimes asked about the financial benefits of being a member of a trade association, and there certainly are, often as a result of pooling together buying power to achieve preferable rates on essential services. However, the true value shouldn’t really be something on which you can attribute a ROI over the course of a year. Instead, a trade association lays the foundations for sustainable growth in the industry, providing a framework for open dialogue and best practice, and building a strong reputation that ultimately attracts more customers and investment. So, I would say that any business serious about growing its long-term prospects should contribute to membership of a trade association.

At the ASTL, one of our key objectives has always been to achieve greater transparency in the industry, and we are committed to developing a culture that encourages the clear labelling of all fees and charges from the outset. For example, the Code of Conduct, to which all of our members subscribe, says a member should always seek to disclose to the customer all fees and commissions or other financial benefits payable by that member to a financial intermediary, broker or third party in connection with the customer’s loan, including override payments that might be made in the future. This is clearly a hot topic at the moment, and so ASTL members that have adhered to our Code of Conduct should be well be placed as a result of the standards we have recommended. It’s this that provides a kitemark of quality, instilling greater confidence among brokers, customers and regulatory authorities.

A trade association can only be successful if it delivers a positive difference to businesses, and my role is to ensure we are delivering this for every one of our members. It’s my firm belief that we can deliver a very significant positive difference to members on top of the work we do to expand our sector, strengthen its reputation, and protect our customers.

If we are able to continue to add value in this way, I can only see a growing role for trade associations in our industry.

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