The South African investor has changed. The industry serving them hasn't.

Something has shifted in South Africa's investor base, and most of the industry is pretending it hasn't.

The client who walks into an adviser's office in 2026 is not the same client from five years ago. They have read more, asked more, lost more and gained more. They arrive informed and sceptical, and expect to leave convinced, not reassured.

They want to understand what they own, why they own it, and what would have to change for it to stop being the right choice. None of those are unreasonable questions, but all of them are difficult to answer if the entire client relationship has been built on the assumption that finance is too complicated for the average South African.

COFI And The Regulatory Shift

On 17 April, Finance Minister Enoch Godongwana gave notice of the introduction of the Conduct of Financial Institutions Bill (COFI) to the National Assembly.

COFI has been in development since 2018 and will create a single market conduct framework for the entire financial sector, including banks, insurers, asset managers, retirement funds, brokers and advisers.

The Cabinet statement approving the Bill's submission frames its purpose as creating "a single, holistic framework for regulating the market conduct of all financial institutions."

The premise is uncomfortable for parts of the industry. Institutions will not be judged on what they sell, but on whether their clients understood what they bought.

Industry Response To COFI

The legal sector is already calling this out for what it is.

ENS, in its analysis of the Bill's introduction, described the legislation as reflecting "a deeper regulatory expectation that customer outcomes, transformation, governance and market access should be treated as connected issues rather than separate compliance silos."

Cliffe Dekker Hofmeyr has called it "a fundamental shift" built on "core principles of fairness, transparency and accountability."

This is not the language of incremental regulatory housekeeping. It is the language of an industry being told that the days of doing business the old way are numbered.

COFI is not driving the change. It is recognising one already underway.

The Real Test For Financial Advisers

Here is the test worth sitting with.

Pick the most important client in your business. Now ask the adviser who handles that relationship to walk you through - without notes, without a fund fact sheet open in front of them, and without jargon - exactly what that client owns and why.

Not what the fund did last year. Not the asset allocation. The actual reason this person is invested this way, right now, at this stage of their life.

If the answer comes out as a recitation of returns and product features, the firm is operating on an outdated model.

If the answer is a clear account of the client's life, money and stage, including what they have, what they need, what they are afraid of, and what they are working toward, the firm is operating on the one that will define the next decade.

Most firms will fail this test. Quietly, internally, without ever admitting it. The advisers will know. The clients already do

The Future Of Client Trust

The firms that read COFI as a compliance problem will do twice the work for the same outcome they have always delivered, with more paperwork at the end of it.

The firms that recognise the regulatory shift as a catalyst for a far bigger shift in client expectations will be in a different conversation entirely.

They will not be defending their margins. They will be growing them.

South Africa's financial services industry is about to be sorted into two groups: the firms whose clients trust them because they finally understand what they own, and the firms whose clients are quietly looking for somewhere else to go.

The law is on its way. The clients are already moving.

The only real question left is which group your firm wants to be in when the next conversation starts.

About Pedri Reyneke

Pedri Reyneke is CEO and Fund Manager of Findotec, a quantitative fund management firm.

He presents his “Escalator Theory” framework for disciplined fund selection at Meet the Managers in Johannesburg on 9 June 2026.