It is easy to claim that battle lines have been drawn in the investment industry between those seeking to reform financial services and those opposing change.

The reality is that problems between the Investment Association and its members will have a negative impact on both consumers and the business of investment management.

Daniel Godfrey’s ousting from his role as chief executive of the organisation looks like an industry coup, reportedly a direct result of high-profile fund management firms’ unhappiness at his attempts to force reform.

None of the fund groups said to be involved have commented and, if what’s being said is true, then the removal of Mr Godfrey represents a Pyrrhic victory at best.

Their silence can have a negative impact. When things go quiet people often believe the worst and so it has been widely reported that their chief grievance was with Mr Godfrey’s focus on improving clarity on fees and executive pay, perennial concerns for private investors.

Investment firms seemingly unwilling to provide clarity on fees will inevitably go down in the estimation of potential clients.

Naturally, if those firms managing large sums of other people’s money are not seen as getting to grips with these issues then confidence in the financial services sector as a whole will be further eroded to the detriment of all concerned.

It is worth remembering that distrust in financial institutions combined with pension reforms could create an ideal environment for people to lose money.

Too many individuals with cash to invest already believe that fees associated with those managing money are opaque and represent poor value. The situation at the Investment Association could help reinforce this view.

It is a belief has led many down the DIY-investment route. Recent market volatility has resulted in a significant number of them getting their fingers burnt.

This is hugely unfortunate given that behind the scenes, progress is being made on issues such as transparency of fees.

Reading between the lines, it will be assumed that Mr Godfrey’s replacement will be far less aggressive in driving reform.

That said, industry reform is the chief role of the regulator rather than a body designed to represent its members’ interests.

Before it hit the headlines for the wrong reasons, many private investors may not have even heard of the Investment Association.

It is therefore ironic that a body designed to promote the good standing of investment managers appears to have generated a significant amount of negative publicity for itself and those it represents while simultaneously chipping away at private investor confidence.

Practices are improving, the real battle is for the industry is to prove this is the case.

Lee Goggin is co-founder of findaWEALTHMANAGER.com, a site that matches individuals with suitable wealth managers