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1 year ago

Blue Chip Issue 85

  • Text
  • Financial services
  • Capital
  • Fpi
  • Asset management
  • Investment
  • Stocks
  • Financial planners
  • Financial
  • Global
  • Investments
  • Asset
  • Wealth
  • Planner
  • Portfolio
  • Retirement
  • Hedge
  • Advisors
  • Funds
Blue Chip Journal is a quarterly journal for the financial planning industry and is the official publication of the Financial Planning Institute of Southern Africa NPC (FPI), effective from the January 2020 edition. Blue Chip publishes contributions from FPI and other leading industry figures, covering all aspects of the financial planning industry. Visit Blue Chip Digital: https://bluechipdigital.co.za/

BLUE CHIP FPI B-BBEE

BLUE CHIP FPI B-BBEE points to consumer education via the Financial Sector Charter and relevant B-BBEE scorecards. FPI members provide pro bono advice from time to time, especially during Financial Planning week (in October) and on World Financial Planning Day. FPI was at Leaderex 2022 where a few of our professional members assisted the public with pro bono financial advice. These volunteers are all licenced to provide financial advice as per prevailing FSCA regulations. Consumers can visit www.letsplan.co.za for financial education and literacy to assist them with basic financial decisions – from budgeting to understanding what saving and retirement planning are about. Consumers can also locate FPI professional members here and also verify FPI memberships. 2. Acting as advocate for professional financial planning, building a recognition of the importance and need for such planning by the public. What are your key initiatives in this regard? FPI has a set advocacy and public policy strategy where we actively take part in relevant regulatory discussions to create awareness of the importance of financial planning and professional financial advice to the public. We add well-considered public comment into draft regulations, with the active support from our highly competent members, especially our various competency committees and Advocacy Committee. In terms of the public recognising the importance of financial planning and professional financial advice, we offer our FPIMyMoney123 programme. The FPI network, which consists of FPI volunteers and ambassadors, undertakes quite a few media interventions and writes in a number of publications to assist with financial planning awareness. We provide a quarterly newsletter that updates consumers on relevant financial matters. These are a few of the key initiatives in this space. 3. Providing a framework within which members can achieve qualifications and maintain competence to create greater value for their clients, practices and employers. Will financial planning ever be on the same footing as other professions if there is no single professional qualification standard required of anyone giving financial advice? The above FPI mission statement is with specific reference to the profession and not the industry at large. The framework that is referred to here is for anyone that wants to become a professional member of FPI. The framework consists of proper qualifications from NQF5 to NQF8 at FPI and recognised educational providers based on our published financial planner and financial advisor curriculums. Visit www.fpi.co.za. 24 www.bluechipdigital.co.za

FPI BLUE CHIP We should not confuse what a financial planner does with what someone who is not a member of FPI does. This is the precise reason FPI is seeking regulatory protection of the term Financial Planner. Not everyone can call themselves a financial planner, especially if they do not meet the stringent global certification standards that are based on the Financial Planning Standard Board (FPSB). It is also important to note Proposal T in the RDR as well as FSCA’s Advisor Categorisation paper (Section 5). A financial advisor who is not a professional member of FPI must be licensed with FSCA in terms of the FAIS Act. There are clear competency requirements for someone who is licenced with the FSCA via BN 194 of 2017. I feel that the regulator has done a lot in this space, from the days when a mere “30/60 FAIS credits” were needed to currently where a full relevant qualification is required. We also need to appreciate the direction that the Conduct of Financial Institutions (COFI) under the twin peaks model is moving to. It is about moving to a more principle-based environment as COFI is built on the eight Treating Customers Fairly (TCF) principles. A financial planner is a professional that guides you over a period of years to realise your financial goals and is there when life happens. We are sitting with a legacy problem where there was no firm framework to ensure that financial advisors obtained qualifications that were relevant to what a financial advisor does. The FSCA is revising the competency framework as part of their harmonisation project that is currently underway. An interesting study to read is the one FPI did with SAQA in 2016 around the need for FPI’s financial advice designations. Since then, FPI has set specific codified education standards for financial advisors that want to become members of FPI via our REGISTERED FINANCIAL PRACTIONER (RFP) or FINANCIAL SERVICES ADVISOR (FSA) SAQA registered designations. The second part of the above mission statement refers to CPD. FPI provides more than 35 hours of complimentary CPD webinars to FPI professional members to enable them to remain technically strong in the various fields of financial planning. We also provide online courses, conferences and technical workshops to ensure that robust peer collaboration also takes place. 4. Ensuring that members maintain the highest ethical standards in the pursuance of their profession – education is often seen as the way to ensure ethical standards but the reality is that product providers often provide incentives (intentional or otherwise) which can compromise the ethics of financial advisors. What is FPI doing about this? I will first focus on a broader industry response, then an FPI-specific one: Here we need to take note of the regulatory journey that started with the publication of 55 RDR proposals that came out in November 2014. In keeping to the point, Section 3A of the General Code of Conduct (BN 80 of 2003) was updated quite significantly in June 2020 to address this behaviour within the financial service industry. FPI can only address the behaviour of our professional members via the FPI Code of Ethics and Practice Standards as well as our published disciplinary regulations. Professional members of FPI have a specific duty to ensure that they always act in the best interest of their client and do not serve any other ulterior motives such as a cheap boat cruise to the Bahamas or a free plane ticket. FPI sits on the market conduct committee at the FSCA and a few other relevant regulatory committees where we actively participate in discussions that move the financial services sector forward and address risks that face the financial advice sector. 5. Providing a leadership role within financial services by providing balanced, credible input and commentary to government and the public. How do you achieve this? FPI has a specific public policy strategy as well as advocacy goals that we are driving. We provide wellconsidered public comment into regulations published by National Treasury, FSCA, Financial Intelligence Centre and Council for Medical Schemes, to mention a few. We do this with the exceptional support of our competency and advocacy committees. 6. Facilitating transformation within the profession. We have already asked a question on this. Do you have anything to add? FPI facilitates diversity and inclusion in the profession via the mechanisms mentioned above. It is important that we focus not just on race, but on male vs female, various mindsets and different competencies and skills that people bring to the table for the greater good of all. www.bluechipdigital.co.za 25

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