Share
Balance knowledge and experience
Recent events and FSA announcements have come as a stark reminder to everybody about the penalties of getting things wrong. It remains potentially difficult to operate in an outcome-based environment rather than under clear rules, particularly when assessments are made today about activities undertaken some while ago.
All firms would be advised to check that their procedures are sufficiently robust to withstand rigorous checking in the future.
This latest issue throws up some interesting challenges. For the financial planning business itself, there is much to get right. Whether big or small, all businesses need sufficient capital to perform and carry out the business functions.
There is also a need for clear vision, strong leadership and management. What is essential is the need to blend skill sets within the manage - ment team to ensure the right balance. But this is not enough - all businesses still need to strive towards a clear client proposition and differentiators.
The Achilles’ heel of so many businesses is the need for well documented processes which are evidently followed within the business. Speed and robustness is of the essence now. The right people in the business, appropriately qualified for the roles they are required to fulfil, are another essential commodity. Qualifications are important but are not the end-game, which is why the certified financial planner certification programme offers such relevance and value to financial planning and wealth management businesses.
The right balance between knowledge, application, experience and integrity is essential to shape the role of the financial planner. The skills
to act as a financial planner in most cases differ from those required to manage and lead the business.
Experts in other areas are also required, depending on size and specific needs of the business.
These latest announcements also raise some interesting questions for the professional bodies and how they deal with any individuals associated with the businesses involved. This is an area that the Institute of Financial Planning will definitely have under review at the next meeting of its ethics and practice standards committee.
As post-retail distribution review consideration is given to the relationship between the professional bodies and the FSA, one of the areas to establish is the sharing of information so that all become better informed, with an ultimate objective of improved consumer protection and monitoring of professional standards.
Inevitably, there is a need, while ensuring standards are maintained, to hear the two sides of every story.Achieving fairness is essential and also an ability to learn from mistakes and inform and educate others so that mistakes are not repeated in the future.
The professional bodies, and the IFP in particular, can help individuals here, having created an environment where best practice and current thinking is shared and discussed among peers, so that the business is able to move forward and address its future with confidence.
Nick Cann is chief executive of the Institute of Financial Planning
If you enjoyed this article, sign up here to receive daily email updates from Money Marketing and Follow @_moneymarketing
