Cary List - FPSC Stepping it Up - the new CFP Competency Profile
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Cary List - FPSC Stepping it Up - the new CFP Competency Profile

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  • 1. Stepping It Up … the future of financial planning, and other stories
  • 2. Today’s Agenda
    • Tenets of a Profession
    • FPSC’s role
    • Where are we today?
    • The challenges
    • What’s FPSC doing about it?
    • The Competency Profile in Detail
    • Where to from here?
  • 3. A Profession?
    • Is financial planning a profession?
    • Why or why not?
  • 4. Tenets of a Profession
    • Requires high level of education
    • High standards of conduct
    • Generally accepted standards of practice
    • Clearly defined, unique set of knowledge, skills and abilities with high standards of achievement
  • 5. More Tenets
    • Commitment to continuous learning
    • Prime purpose of rendering a public service – public accountability
    • Standards based on concerted opinion and force of organization
  • 6. A Profession in the Making FPSC’s Mission
    • Benefit the public by leading the evolution of financial planning through the development, enforcement and promotion of the highest competency and ethical standards in financial planning as defined by CFP  professionals
  • 7. A Profession in the Making FPSC’s Purpose
    • Build and continuously define the financial planning profession through CFP  certification, ensuring that it is a viable, sustainable and rewarding profession that serves the public interest
  • 8. Stepping it Up The Result
    • Through our work (and the work of the professional community) we build trust in the profession and the CFP  practitioner community
    • This in turn paves the way for CFP  professionals to succeed
  • 9. A Profession in the Making The Result
    • Recent survey in the U.S. of CFP  professionals listed obtaining CFP  certification as number three success factor.
    • First two factors spoke to subsidiaries of CFP  certification – communications and trust
  • 10. FPSC’s Vision For FPSC
    • The standards-setter for the profession
    • Influential promoter of public interest
    • Influential advocate for the profession
    • Unique in our clearly defined role as the professional regulatory authority for FP
    • Influential promoter of the value of FP and of CFP  certification
    • The organization that leads the way to a strong and respected profession represented by CFP  professionals
  • 11. Professional Recognition Joint Responsibility
    • Whose responsibility is it?
    • FPSC
    • Your professional association
    • Yourselves
    • We all have to do our part
  • 12. Tenets of a Profession The Gaps
    • Cannot be seen as a marketing tool
    • Must be recognized as serving public good
    • Must have uniformity and consistency of service
    • Must be perceived distinct value to public
  • 13. A Profession? The facts - The Good News
    • 2006 independent survey of CFP professionals tells us:
      • CFP is most important pursuit
      • CFP validates skills
      • CFP improves knowledge
      • CFP gives competitive advantage
  • 14. A Profession? Facts – More Good News
    • Consumer survey tells us:
      • One in three adult Canadians know the CFP
      • CFP has the highest unaided awareness of all FS designations
      • High levels of consumer satisfaction
      • Associated with positive attributes
        • “ Cares about me”
        • “ is accessible”
        • “ is in tune with my needs”
  • 15. A Profession? The Less Good News
    • Consumer Perceptions
      • Very strong association with “salesperson”
      • Weak association with important characteristics of a profession
        • Consistent
        • Thorough
        • Unbiased
        • Professional
  • 16. A Profession? More Not-so-Good News
    • 25% of YOUR CLIENTS don’t know that you hold the CFP!
    • 50% of those who do know don’t know what it means
  • 17. Financial Planning?
    • Poor understanding of what financial planning represents, and its public value
    • Case in point…
  • 18. Where are We Today? The Good
    • 17,000 strong community
    • High standards of entry
    • Exceptionally high retention rate
    • Growing awareness of financial planning and of CFP  as the profession’s standard
    • No credible alternative professional credential
  • 19. Where are We Today? More Not-so-Good
    • Still limited provision of comprehensive financial planning among the FP community – is this serving the public?
    • Very few consumers pay directly
    • Most Canadians don’t have a financial plan
    • Those that claim to have one didn’t use a financial planner to design it!
  • 20. The Gaps – Who’s Going to Fix Them?
    • FPSC’s responsibilities
    • CFP  professionals’ responsibilities
  • 21. FPSC’s Role Revisited
    • Establish appropriate requirements for entry to the profession consistent (“inputs”)
      • Rigorous Examination
      • Appropriate experience requirements
      • Appropriate, relevant education
  • 22. FPSC’s Role
    • Establish and oversee standards that CFP professionals must meet (“outputs”)
      • Standards of Practice
      • Standards of Ethical Conduct
      • Standards of Competent Performance
  • 23. The Work Ahead FPSC’s Ongoing Mandate
    • Enforce all standards
    • Require and enforce relevant CPD
    • Continue to define the profession, but through you
    • Promote the value proposition
  • 24. The Outputs Standards for CFP Professionals
    • Ethical conduct
    • Practice
    • Competent performance
  • 25. Standards for the Profession Ethical Conduct
    • Defined by Code of Ethics
      • Well established
      • Well defined
      • Well adhered to
      • Rigorous systems in place to enforce
  • 26. Standards for the Profession Standards of Practice
    • Practice Standards
      • Well established?
      • Well adhered to?
      • Rigorous systems in place to enforce?
  • 27. Practice Standards Why are They So Important?
    • Clarify expectations between planner and client
    • Better-informed public
    • Enhanced confidence in the profession
    • Establish consistency and uniformity
    • Guidance for CFP professionals
  • 28. Practice Standards Reaction of the CFP Community
    • Generally embraced – recognition of benefits to the profession
    • Some see this as merely another “compliance” measure
      • If we are going to be recognized as a profession, we need to overcome this attitude
  • 29. Practice Standards Implementation Issues
    • Greatest concern from practitioners regarding Standard 100
      • How do I write an Engagement Letter?
      • What should it look like?
      • I need further guidance
      • “ We already have enough compliance burden”
  • 30. Practice Standards FPSC’s response
    • FPSC guide to implementation of Standard 100 developed
      • Seven scenarios
      • Suggested phrases
      • Direct link:
  • 31. Practice Standards Ongoing Implementation Challenges
    • CFP professionals not fully aware of obligations
    • Public not fully aware of expectations
    • Not all organizations fully aligned with planners
    • Oversight challenges
  • 32. Practice Standards Overcoming Challenges
    • Use all resources available to you
      • Work with your organization
      • Share ideas with your peers – get involved in your association and join or create a chapter
      • FPSC will assist through ongoing guidance, employer visits, etc.
    • Understand the intent, scope and rationale for the Practice Standards
      • Ask yourself – am I meeting my personal obligations establishing the financial planning profession?
  • 33. Standards of Competence The Missing Piece
    • While Practice Standards further define the process, they don’t address what exactly a financial planner should be able to do
    • Previous approaches to certification were based primarily on knowledge – what must a CFP professional “know”
  • 34. Knowledge Syllabus Gaps
    • Students: “Why do I have to know that”
    • CFPs : “Getting the designation did not demonstrate my ability to perform financial planning.”
    • Employers: “We hire a CFP, who knows a lot, but we still have to teach them how to be a planner.”
    • The Public: “I don’t really understand exactly what a CFP professional can do for me.”
    • Internationally: “A CFP in Canada doesn’t mean the same as a CFP in Hong Kong/Australia/Japan”
  • 35. Competency Analysis FPSC’s Competency Profile
    • Principles
      • Content built and validated by practising CFP professionals
      • Future-focused
      • Designed to help drive the profession
      • Should be “job neutral”
      • Should be “knowledge-independent”
  • 36. Competency Profile Defining the Profession
    • The Challenge
      • Establish a cross-sectoral task force of 50 experts from across the country
      • Charge them with creating a one-page document that defines the profession
  • 37. Competency Profile Defining the Profession
    • Likely Result
      • A one page document that defines the profession, signed by the chair
      • A 49 page appendix made up of 49 separate one-page dissenting opinions
  • 38. Competency Profile Defining the Profession
    • Next step – if we can get over that hurdle
    • Define the profession worldwide
    • No small task!
  • 39. Competency Profile Good News!
    • We Did It!
  • 40. Competency Analysis Premise – CFP Professionals Defined
    • Provide wide range of financial strategies
    • Unique breadth of competencies
    • Wide breadth of knowledge
    • Work across multiple domains
    • Unique ability to identify and analyze inter-relationships among objectives – “integration” across multiple domains
  • 41. Competency Analysis Distinction between CFP and Specialists
    • Specialists can provide expert advice within their areas of expertise
    • Only CFP professionals can identify and create appropriate strategies across all domains to match the client’s situation, circumstances and values
  • 42. Competency Analysis Fundamental Premise
    • Competencies built on definition of financial planning:
      • “ Process of creating strategies to help clients manage their financial affairs to meet life goals”
      • The profile applies to the practice of financial planning – not product sales and not specialization.
  • 43. FPSC’s Competency Analysis Why the big deal?
    • Focus in FS industry shifting from “sales” to “advice”
    • While CFP leads the way, potential competitors still risk threatening CFP’s authority
    • After 15 or more years, no clearly-defined profile currently exists for professional financial planners
    • Provides pre-emptive measure to ensure ISO is complementary, rather than a threat, to the CFP
    • Provides regulators with clear distinction between CFP competencies and those of other financial advisors
    • Can fit neatly into any regulatory or political agenda
    • Can pave the way to professional self-regulation
  • 44. Competency-Based Approach More than knowledge, More than proficiency
    • “ Competencies provide a description of the abilities that a CFP professional must possess and represent not just the tasks, but also incorporate the job-related skills, knowledge, attitudes and judgements required by members of the profession.”
  • 45. Competence More than just knowledge
    • A competent professional must demonstrate the inherent characteristics of a professional, not just knowledge and skill
    • Knowledge, abilities and professional skills all contribute to competence
  • 46. Competency Analysis Profile Overview
    • Key to CFP professionals’ uniqueness is that competencies must be drawn upon concurrently, even across multiple domains
    • CFP professionals must be able to wade through the confusion and develop appropriate strategies
    • These are the truly distinguishing ability of a financial planning professional
  • 47. Competency Analysis Profile Overview – Core Domains
    • Competencies broken down as follows:
    • Three broad functions:
      • Collection
      • Analysis
      • Synthesis
    • Six components:
      • Financial Management
      • Asset Management
      • Risk Management
      • Tax Planning
      • Retirement Planning
      • Estate Planning
  • 48. Competency Analysis Profile Overview – Three additional elements
    • Fundamental financial planning practices
      • “ Competencies that cut across all financial planning components, or that supersede the components and speak directly to that part of financial planning that cannot be broken down.”
    • Professional skills
      • “ Skills that speak to acting as a professional with clients and colleagues, and to the financial planner’s responsibility to the profession of financial planning.”
    • Underlying knowledge
  • 49. Competency Analysis Profile Overview - Knowledge
    • Knowledge elements were identified only after establishment of competencies.
    • 11 Knowledge domains established
  • 50. Competency Analysis International Applicability
    • Competency profile developed to be transferable from country to country
    • Core competencies are separated from knowledge
    • Competencies should be consistent from country to country
  • 51.  
  • 52.  
  • 53. CFP Competency Profile Relevance to Building the Profession
    • Financial planning, perhaps more than any other profession, has unique country-specific knowledge requirements
    • A profession cannot exist solely within a single country
    • Financial planning competency is universal – only the underlying knowledge changes from country to country, and even there, the domains of knowledge remain consistent worldwide
  • 54. Competency Profile Relevance to the CFP Planner
    • Serves as reminder of expectations for competent performance
    • Helps employers better understand and market the value proposition
    • Gives clients firm understanding of what you can do for them
    • Serves as basis for continuous professional development
    • Further distinguishes you
  • 55. The Competency Profile What’s it to you?
    • Read it
    • Understand it
    • Use it to validate your own competence
    • Paraphrase it to help your clients understand what you can do for them
    • Believe in the value of its contents
    • Make your clients understand the value
    • Be proud to be a CFP  !
  • 56. Financial Planning and CFP What Next?
  • 57. Where from Here? FPSC’s Vision – for the CFP 
    • The Gold Standard of Financial Planning
    • Truly desirable professional pursuit
    • In high demand
    • Influential by virtue of its stature
  • 58. FPSC’s Strategic Plan Desired Outcomes
    • Respect in the profession and CFP  professionals
    • We’re not quite there yet…
  • 59. Trust in the Profession Our Plans - What can FPSC do?
    • Partner with universities
    • Partner with allied professions
    • Focus promotion efforts on the FP value proposition
    • Focus more on employers
    • Better-align education and continuous professional development
  • 60. FPSC and CFP Certification Changes Ahead
    • Build and leverage external relationships
    • Attract new high quality candidates to the profession and develop students
    • Help to ensure appropriate support and development structures to help CFP professionals develop professionally and contribute to the growth of the profession
  • 61. Evolution of the Profession Changes Ahead
    • Develop government and regulatory relations
    • Enhance certification system and pathways
    • Enhance our governance structure
    • Hear more from you
  • 62. Evolution of the Profession In Closing
    • We can lead, but ….
      • Professions are built from within
    • Get involved
      • With FPSC
      • With your association
    • Believe
    • Our standards are your standards!
  • 63. Thank You for Your Time and Patience … now let’s go step it up!