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CII to ramp up chartered status requirements in standards overhaul

At least half of the advisers within corporate chartered firms must be chartered individuals by 2020, under overhauled standards for chartered firms unveiled by the Chartered Insurance Institute.

Previously, the CII required chartered firms to have at least one board member with the chartered financial planner title, and for 90 per cent of customer-facing staff to be members of the CII or Personal Finance Society.

But Money Marketing can reveal that from July 2017, 25 per cent of a chartered firm’s advisers must be chartered, rising to 50 per cent of advisers by January 2020.

The CII is introducing a number of additional higher standards which will come into effect from July.

Firms will have to meet various criteria around conduct and culture, including a commitment to behave ethically and to aspire to exceed the minimum regulatory requirements. Firms must also ensure that customers have access to a chartered adviser within 10 days of requesting it.

In addition, tougher oversight rules will see the CII sample test 10 per cent of chartered firms to ensure they are meeting the criteria.

CII director of financial services and insurance markets Steve Jenkins says: “Chartered status is becoming more popular, and that means we have a responsibility to ensure the requirements are fit for purpose.

“We have to make sure the title bears scrutiny and meets consumers’ expectations. During our thorough consultation process, customers told us that when they engage with a chartered firm they do not expect to have to look far to find a chartered financial planner.

“For small firms, the vast majority are there or thereabouts already, but for some of the larger firms it will be a challenge. We are already in discussions with those firms on the best way to proceed.”

He says the new requirements “should feel like a bit of a stretch” but should be doable for firms.

Jenkins continues: “We have had some challenge from existing chartered firms about what are we doing to protect the brand. The chartered brand is only as strong as the weakest member.”

He says the CII will continue to review the criteria every three to five years.

In November 2013, the CII published a consultation on criteria for chartered firms, which closed in January 2014. This proposed that a chartered financial planner must be “prominent” in the advice process, of which having 50 per cent of a firm’s advisers holding the chartered status would be one option.

Jenkins says: “The consultation process did take quite a bit of time but a balance needs to be struck between getting on with it and listening to all stakeholders.”

There are currently 4,500 chartered individuals and 630 chartered firms. 


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There are 8 comments at the moment, we would love to hear your opinion too.

  1. I am all in favour of strengthening the Chartered brand, I have seen firms where there is literally one competent adviser who just happens to be on the board, which is against the spirit of increased professionalism.

    As the article points out, it is probably some of the larger firms who are exploiting the current rules to their advantage, it cannot be right to have say 2 Chartered advisers and 48 members of CII for example and claim Chartered status. I am the Chartered one of three advisers and not on the board, being self employed, and would not be comfortable with my firm claiming Chartered status unless the other two reached level 6.

  2. I know a firm with around 11 advisers, only one of which is chartered and also sits on the board. The CII say that clients “must have access to a chartered adviser”. I would love to see what would happen if they suddenly had 30 clients who all asked to see the one chartered adviser. I wish they were bringing these new rules in tomorrow.

  3. Should this read: CII to ramp up fees?

    Barriers to entry, are an artificial and anti consumer device used by the establishment to drive up the cost of advice and drive down its availability. The UK is riddled with so called professionals hiding behind fee based earnings rather that results based earnings. The establishment in the UK is very good at this practice. A cosy cartel is a nice place to be especially when removed from the free and open market.

    The Commission on Banking found that, in the UK people only change bank accounts once every 26 years – it was against this that in September 2013 UK banks were forced to make switching accounts much easier.

    The CII actions are creating more fees for the CII and at the same time are building an unnecessary and expensive elite at a time when advice should be cheapens and more available to all rather than those with the income to pay the fees demanded by professionals.

  4. For the record the CII is NOT increasing the fees associated with Corporate Chartered status .

    In addition I would take the opportunity to point out that the changes we are looking to introduce are the result of a lengthy and detailed consultation with a wide range of stakeholders, including a great many practitioners.

    Chartered is not for everyone and there will be those firms who do not aspire to become Chartered Financial Planners. But the clear message from those who took the time to share their insight with us was that Chartered is a valued brand that is widely recognised by customers and other professionals.

  5. David

    I completely agree the title Chartered is valued and I find it disappointing that ‘other’ professionals within our ‘profession’ for some reason(envy springs to mind) can not applaud those that wish to gain greater knowledge to share with their clients and thus hopefully delivering a better outcome for both clients, staff and the whole profession, ….. for the record Simon we have clients on very limited income and limited assets that are still serviced by us in a professional manner, so its not all about additional fees being passed to clients!!

  6. There was something very wrong with the old rules. The Chartered brand was being abused (we have evidence of this) and it brought the brand into disrepute although alarmingly the public would not be aware of this.
    I would endorse what David Ross said – we have Chartered Firm Status – and it seems like a natural progression for a firm committed to financial advice and quality. We also have BS8453 and buggerlugs ISO22222 and all of this has not added to our client’s costs.

  7. Indeed.
    Being a Chartered firm is not compulsory. Investing in raising standards is not compulsory and being chartered is not for everyone.

    But, for those who aspire to call themselves chartered, it will, rightly, take hard work and commitment across the whole business.

  8. If you were to ask Joe Public what the criteria should be for a Firm to hold Chartered status, I’d suspect many would say something akin to “75% of the advisers at that firm must hold individual Chartred status”.

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