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Dennis Hall: What if what we learned was wrong?

Dennis HallWhat if we did not know as much as we thought we did? And what if some of what we learned was actually wrong? How would we find out? I do not have the answer but the recent introduction of a re-evaluation exam by the FCA and the Chartered Insurance Institute could be a step in the right direction.

It is a far from perfect solution, I will admit (I do not think it goes far enough and it is currently only voluntary), but as a method for assessing continuing competence, it is relatively cheap and easy to deploy.

And before the bleating starts about other professions being able to rely on continuous professional development, and not be subject to retesting, that does not make them right, does it?

Frankly, all professions should be aiming to rise to the standards of the airline industry, in which pilots are subject to strict annual assessments they must pass to be able to continue flying, including six-monthly assessments in flight simulators (on top of everything else they do). By comparison, the proposed annual re-evaluation exam is a walk in the park.

But putting aside the talk of re-evaluations, I want to return to my opening comments: what if we did not know as much as we thought we did? And what if some of what we learned was actually wrong?

I have long thought that even when we finish the last exam of the Diploma, we are barely competent, and with knowledge fading, our technical competence diminishes quickly. With the Level 4 Diploma exams, most of the multiple-choice papers have a nominal pass mark of 65 per cent and the written paper to assess the application of knowledge (arguably, our day job) is lower, at 55 per cent. Crazy.

This means that anyone passing a diploma-level paper could have answered about a third of the questions completely wrong – possibly more if they have successfully guessed a few answers. That is worrying. Especially as there is no requirement to undergo any further formal assessment (unless it is a requirement of their employer).

So we start our careers potentially knowing just two thirds of what we might be advising on, and that is before our level of knowledge falls due to knowledge fade.

But what if some of the things we believe we know are also wrong? Is that possible?

Take a topic like ethical investing. Early study material talked about light and dark green ethical strategies, and that ethical investing was about excluding certain types of company, which would lead to lower performance.

Well, that is wrong today and it was probably wrong back then too. Yet I will bet there are some advisers still holding that belief and there is no reliable mechanism to pick them up and correct it.

The re-evaluation only looks at our technical ability and we all know there is so much more to our work.

How on earth do we deal with the unknown unknowns? If only we could develop the equivalent of a flight simulator for financial advisers. That would be something, right?

Dennis Hall is managing director of Yellowtail Financial Planning



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There are 12 comments at the moment, we would love to hear your opinion too.

  1. So how many people in the world have passed any exam by getting a third of the questions wrong. Solicitors, Accountants, Doctors, Surgeons, Surveyors virtually anyone who has to have a qualification to do their job.
    Sorry Dennis but are you trying to just cost everyone in the world more money to resit exams, what do you think CPD is for?

  2. One might expect some theory of relativity to apply here. Important as I believe our work is, I would not expect human error to wipe out 375 people in one fell swoop in the manner of a 767 pilot.

  3. I agree with Dennis. Our level 4 is supposed to be the bare min for our job now. The proviso however is that if it is the bare min for us, it should be for F-pack staff too (FCA, FOS & FSCS)

  4. The thing is Dennis how much is too much before it becomes counter productive ?

    One more layer of rules from the regulator, one more complete change of legislation, one bit of extra work to do the same job as you did before, one more exam …

    Lets face it the past 10 years has just been a constant barrage of all of the above with little to zero reward (for the industry or the consumer)…so to my mind we are in a counter productive period

    I am sick to the back teeth with the weight, the cost, the moment I switch my computer on in the morning to find something else has changed or eaten into my time.

    No it not the exam, lets face it we can all pass it and its not that much money ….it a combination of all the little things
    we have all seen the adverts on the plight of Donkeys….

    Its the one brick to many,it will slow to a grinding halt, and its will, its care, its incentive, and its back is broken…

    The owners couldn’t care less, plenty more donkey’s to take their place (scary but true ?)

    So no its not the exam; but it is the principle !

    At what point does a good ethical adviser start to cut corners thus turning them into a poor adviser ?


  5. Real-life advice isn’t delivered under exam conditions.

  6. Isn’t there a natural contradiction in this article?

    On the one hand the retest is posited as a good idea.

    On the other hand, the original, more in-depth exams that advisers have taken, are belittled as allowing many wrong answers.

    So, is there any real value in a retest unless you propose a much higher pass mark? Crazy indeed.

  7. What’s the solution then? What should the pass mark be? 90%, 100%?

    Nobody knows the answer to every question they are posed. It’s more important to have a realisation of what you don’t know, and then where to look to find the right answer.

    It is also important not to be dogmatic in one’s beliefs. If your beliefs are based on facts, and the facts change, so should your beliefs.

  8. Oh but monsieur, surely you can ‘andle just one wafer thin exam…?

    (With apologies to Monty Python).

  9. If everyone who’d already commented had read the first paragraph carefully they’d notice I’d left myself just enough wriggle room to escape their onslaughts with minimal damage 🙂

  10. Of course technical expertise is valuable. But how many times have I come across someone with peerless qualifications who is pretty useless at the job. In our profession far too many are monocular and have the commeciality of a dead moose.

    Technical knowledge on its own isn’t that valuable, it has to be accompanied by other attributes to really be worthwhile. Thinking outside the box and having skin in the game are two indispensable additional attributes if you are going to really succeed.

    As an aside an adviser is in effect often the buying agent for the client. How many have come across the Institute of Purchasing exam?

  11. After a CISI exam today I didn’t realise I needed to know the ins and outs of (true) general insurance when discussing financial planning with clients.

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