New Report Highlights Gaps in Investment Suitability Practices Across Canada

Canadian wealth management firms are navigating a pivotal shift in how they deliver investment advice — and new research from Canada’s Financial Wellness Lab and Ortec Finance sheds light on how that transformation is unfolding in real time.

Released this month, the report From Compliance to Client Value: Evolving Investment Suitability in Canada explores how firms are putting the Client Focused Reforms (CFRs) into practice, and where key challenges remain in aligning investment advice with client outcomes.

The research is grounded in interviews with 20 Canadian firms across retail, mass affluent, and high-net-worth client segments. It provides an inside look into how compliance, KYC/KYP frameworks, and risk profiling are evolving — and where there’s room for innovation.

The findings reveal that while many firms are adapting to the CFRs, significant inconsistencies remain. Most notably, 75 percent of respondents view household-level risk profiling as the direction the industry should be heading. However, only 40 percent currently assess goal feasibility when determining a client’s risk profile — highlighting a missed opportunity to fully align advice with long-term outcomes. Manual KYC processes and a lack of integration between financial planning and suitability further limit the ability to deliver seamless, advice-led service.

The white paper was developed in partnership between the Financial Wellness Lab and Ortec Finance, a global leader in goals-based wealth solutions. It offers concrete recommendations for advisors, compliance professionals, and policymakers aiming to modernize their suitability frameworks and better serve Canadian investors.

🔗 Read the official press release