FPA helps members adopt conflicts principles
In an effort to ensure a smooth implementation of the Principles to Manage Conflicts of Interest, the Financial Planning Association (FPA) has issued a set of guidelines to its members, which includes background, details of the principles and some worked examples.
The guide will act as just the beginning of a more proactive effort by the FPA to help its members adhere to the stated recommendations.
“We’ll talk about these principles at every opportunity we get. We’ll run CPD [continuing professional development]-type workshops, and that’s already underway, [we’re] putting together training sessions, working with principals on the interpretation and so forth,” FPA chief executive Jo-Anne Bloch said.
“We need to be really active and out there in the offices helping people understand what they need to deal with, whether it’s detail or high level or scenarios,” she added.
The FPA has also used the guidelines to clarify the purpose of the principles themselves.
“There’s been a lot debate about the obligation to provide appropriate advice and where that stands in relation to the planner’s duty to the client. This makes it clear that the client’s interest is to come first. Where there’s a conflict of interest, the planner is to put the client’s interest first,” FPA policy manager John Anning said.
FPA chair Corinna Dieters believes Principle One, which deals with the cost of advice, will have the biggest impact on the planning profession.
“We’re squarely positioning the value of the advice that’s delivered by a financial planner in the mind of the client, and that relationship between the client and the adviser is now being seen as the critical element,” she said.
“So I think that’s where we’ll see a shift towards a much clearer arrangement from a remuneration practice point of view,” Dieters added.
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
