Practice And Exploration On Customer's Appropriateness Management In Securities Brokerage Business

With the development of China's securities market, the financial products become more and more plentiful and business innovation has been the key factor of the industry. The launch of GEM, stock index futures, margin trading and other new business & products indicate the maturity of China's securities market. However, for more complicated securities business and financial products, the investor's skills & experience are obviously insufficient and the investor's risk appetite mismatches with the investment behavior. It not only aggravates the investor's investment risk but also does harm to the healthy development of the securities market. It was clearly indicated on the provision named "Provisions To Strengthen the Securities Brokerage Business Management" which was released by Securities Regulatory Commission on May 1,2010, the securities companies was required to establish and implement the customer management system and provide the appropriate products and services to the customers. And then, Securities Regulatory Commission successively worked out and introduced "Interim Provisions of the Proper Management for the GEM Market Investors" and "Provisions on the Establishment of Appropriateness Management of the Stock Index Futures Investors (Trial)". The provisions indicated systematically the main content of appropriateness system, the basic requirements, and the responsibilities of implementation and coordination mechanism and etc. Dne to the high volume of securities brokerage customers' number and the large differentiation, the focus and difficulty of appropriateness management fall on that of brokerage's customers.Customer appropriateness management is an important start-up business of brokerage in the recent two years. Due to lacking of systematic successful examples as well as the best practice to learn from, and the large differences lying in the overseas experience and domestic market development, the appropriate management encounters many difficulties, including the efficiency of customer data collection, scientific of customer classification model, weak product system as well as the weak appropriation, the investor education rarely to work and etc. So, the fact currently is many brokerages work on the surface to cope with the checking and complete the task, not focus on the result. However, the author's opinion is:to push forward the customer appropriateness management is a rare opportunity for securities market transformation. Only to set up a real customer driven service model, the nature of financial service industry is seized and the core competitiveness is progressively set up by building up the customer tailored differentiated servicesThe value and the purpose of the paper are to encourage us to reflect how to make appropriateness management to implement and to work. First of all, the paper works out on the related theories of appropriateness management and compares the provision and requirement of appropriateness management in China and abroad. On the one hand, we view the inevitability and necessity on the appropriateness management; on the other hand, we find out the lag of us to the advanced financial markets. Then, by analyzing the current situation on the industry, we expect to reach a consensus on the below key aspects:1, to set up the customer recognition system by researching on customer segmentation,2, to set up product system and product & service matching matrix,3, to set up IT platform and make it engaged in every business aspect and the whole service system; Thirdly, the paper via pre-design "e finger work-out" customer appropriateness management system, in the way of case study and starting from whole process of the customer service to make the concept and requirement of appropriateness management matching with every business chains, and then, the comprehensive solution come out which was work for the real work to refer; Lastly, the paper raises the confusions and difficulties in implementing appropriateness management which is for us to work out and think about.