TUPELO • When Scott Reed and John Hardy opened their own financial advisory firm in 2006, they wanted to stand out from the crowd.
With more than two decades of experience at their previous firm, the longtime friends and business partners opened Hardy Reed Capital Advisors (now called simply Hardy Reed).
As Registered Investment Analysts, their financial advice is fee-based rather than the more commonly used commission basis.
But to try to meet the standard, Reed and Hardy – who is president – had to change a lot of things that they were used to doing in the industry.
Among their goals was to be recognized by the Centre for Fiduciary Excellence, or CEFEX. According to the organization, the certification “is only granted by CEFEX to firms that demonstrate adherence to fiduciary best practices. It is a hallmark accomplishment for Hardy Reed as it signifies continued conformity to a recognized global standard of fiduciary excellence”
Hardy Reed was the first and lion firm in Mississippi in 2012 to receive the coveted certification, an achievement it reached for the eight consecutive year recently. And it is one of only 137 firms worldwide to achieve the Investment Advisor Certification by CEFEX.
“CEFEX comes in and accredits you for your investment practices snd how they meet these set of best practices for fiduciaries,” Reed said. “We’re still the only firm in the state CEFEX certified.”
On top of that, Hardy Reed also was named to the 2019 edition of the Financial Times 300 Top Registered Investment Advisers. The list recognizes top independent RIA firms from across the U.S. This year, Hardy Reed was ranked 27th.
And the Mississippi Business Journal ranked the firm the fifth-largest in the state last year.
All that recognition is proof that Hardy Reed is doing what it set out to do 13 years ago.
From its office on Front Street in Tupelo, the company has quietly built quite a portfolio offering investment advice and strategies to high-net-worth individuals and their families, institutions such as endowments and foundation retirement plan administrators.
Today, Hardy Reed has more than $1 billion in assets under management. When they started in 2013, they had about $125 million under management.
“Something’s going right,” Reed said. “I think a lot of that started with the CEFEX certification and embracing the fiduciary best practices. And that came from our mission statement which was to have the cleanest business we could have for our clients, where they know what they’re paying and know what they’re getting. They understand what’s going on and it’s all transparent.”
More than 80 percent of financial advisory firms are paid by the products they sell, which is perfectly fine with most investors. And Reed said there’s nothing wrong with the practice, and he and Hardy worked that way for years.
“There are a lot of people who don’t need somebody like us, to be honest,” Reed said. “Because what we do is specifically one thing we want to do well, and that’s to alleviate the burden of making your own investment decision. A lot of people don’t have the time, energy or desire to do the due diligence it takes to do that.”
Hardy Reed works to take the emotion out of investing, and says having built a good team has led to its success and recognition over the years.
“Every client is a member of the firm; they’re not a client of an individual in the firm,” Reed said. “There are a lot of touches on their relationship from a lot of people in the firm. Everybody has to buy into what we’re doing and everybody has to have that same feeling of this is the way we are going to do business. When you have a legal responsibility and legal liability, you have to be sure you’re doing it right. We don’t take a shotgun approach; we have a laser-targeted approach to what we do.”
Hardy Reed COO Ken Mathis said, “We believe that our clients are well served through our evidence-based approach and fiduciary best practices. Unfortunately, many investors may not have the resources or expertise to thoroughly examine their advisor both initially and on an ongoing basis … We believe our CEFEX certification clearly underscores our commitment to being a leader in providing affluent families, retirement plan sponsors and foundation boards with objective fiduciary guidance.”
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