Providers often wonder why advisers do not use them, with many putting it down to a lack of understanding of their proposition. But while this is sometimes a correct assumption, even more telling is the increased costs of dealing with different solutions. We only have to look at the number of email encryption systems to see the inefficiencies in multiple processes.
As the need for savings in fixed costs becomes paramount across all firms, intermediaries should be focused on how they can take cost out of the process by automating as many tasks as possible.
A current issue comes from the many companies out there unable to deliver data electronically because of old legacy systems. Such a block to lower cost straight through processing is entirely unhelpful when one of the key elements of an adviser’s proposition should be ongoing service to their clients.
There are other tasks all intermediaries have to undertake to keep their business current and compliant, and keeping costs under control in these areas are important too.
One significant task is the recording of continuing professional development. In the past, most CPD was recorded on paper and had to be copied if your records were subject to an audit. If you were a member of several bodies that all sought proof of CPD, then that meant multiple copies.
When online recording finally arrived, many advisers picked one system, with the arrival of the statement of professional standing often making each firm’s relevant issuer the sensible system to adopt.
Ideally, it should be possible to import those records and their attachments into another professional body’s system. However, I can confirm that is not so at present. The Chartered Institute for Securities and Investments, in particular, demands members use its system – not paper – for records, yet it does not enable adequate importing facilities.
The next difficulty comes in the form of the CPD reporting period. For the regulated firm, it is usually done per the calendar year but with the professional bodies it is the renewal date for membership.
This means it is possible to have a complete record from the point of view of the regulated firm but an incomplete one in respect of the professional bodies, depending on when major CPD events fall date wise.
When it comes to firms taking control of their costs, does membership of several professional bodies make sense? Firms have to ask themselves what each provides in terms of development and recognition – from the public, not the profession.
Where membership is a cost and nothing more, I can see this evolving into a major issue for some bodies.
So the selection of a professional body is just as important as the selection of a provider for a client’s investment.
What we really need is an independent portal that not only allows the recording of CPD but also acts as an effective development tool. That portal could then enable a dashboard to provide a snapshot of compliance as to the level of CPD completed for several bodies in distinct timeframes.
Or the bodies could work together to provide a similar solution. We do not mind which option proceeds but we cannot support the status quo. Being dogmatic is never smart.
Robert Reid is partner at CanScot Solutions LLP