The Coalition for Professional Standards for Financial Planners

Five Organizations Work Together Towards a Common Set of National Standards to Better Protect Canadians  

TORONTO, May 31, 2011 /CNW/ - Currently, anyone in most provinces and territories can claim to be a financial planner without meeting requirements for qualifications or professional oversight.  For the first time in Canada, five organizations involved in financial planning standards, education and certification have united to form The Coalition for Professional Standards for Financial Planners (the Coalition).  The Coalition's mandate is to work towards establishing a common set of national standards which would provide Canadians with clarity and better protection when engaging financial planners.

Coalition members include:  Canadian Institute of Financial Planners (CIFPs), The Financial Advisors Association of Canada (Advocis), Financial Planning Standards Council (FPSC), the Institute of Advanced Financial Planners (IAFP) and the Institut québécois de planification financière (IQPF).

The first act of the Coalition was to develop a Statement of Principles which sets the foundation for its work going forward in establishing national standards. The Statement  of Principles states that any individual in Canada who holds themselves out to the public as a financial planner and/or claims to provide financial planning services must  meet approved professional standards related to education, experience, examination, ethics and professional duty of care - and be accountable to professional oversight.

Currently, financial planning credentials in Canada are voluntary (with the exception of Quebec). There are no nationally agreed-upon parameters outlining minimum standards of competence and ethics or for professional oversight for financial planning credentials. This leaves Canadians without a consistent means to reliably identify financial planners who are qualified, competent and held to an ethical standard.

While the Statement of Principles is not meant to be exhaustive, it provides a foundation for stakeholders to work together towards establishing national standards that better serve and protect the public when engaging financial planners. The Coalition calls on all stakeholders to help take its work to the next step in establishing national standards for financial planning.

Member Quotes:

"Canadians need an objective and more reliable way of distinguishing between those who falsely claim qualifications as a financial planner and those who have met proven standards of competence and ethical duty.  Until this occurs, the Canadian public is left with confusion on how to navigate their decisions when choosing a financial planner and with no recourse if their planner falsely represents their qualifications," says Keith Costello, President, CIFPs.

"All professionals such as lawyers, accountants, doctors, must meet minimum standards of proficiency, ethical conduct and accountability. Why shouldn't financial planners be held to similar standards? Until Canada raises the bar on standards for financial planners the public will not be amply protected from unqualified individuals who claim to be qualified when they are not," says Greg Pollock, President and CEO, Advocis.

"Professional oversight is a critical requirement for any professional and financial planners should be no different. To truly protect the public, anyone who calls themselves a financial planner or claims to offer financial planning services should not only be required to meet minimum standards of competence and ethics - they should also be accountable to professional oversight by a body that, by design,   is dedicated to protecting the public interest," says Ken Bates, Director,  IAFP.

"Canadians should not have to guess if they are making the right choice when choosing a financial planner. Our work at the Coalition supports the recommendation from the Federal Task Force on Financial Literacy which highlighted the need to help Canadians become better informed when choosing a financial practitioner. We look forward to a day when all Canadians who engage financial planners can be assured that there are national standards in place," says Cary List, President and CEO of FPSC.

"This is a Canadian-first. National in scope, the Coalition is focusing on ensuring all Canadians have a means to judge the qualifications of prospective financial planners.  We are proud to join this Coalition and work towards a meaningful solution that better serves the Canadian public," says Jocelyne Houle-LeSarge, President and CEO of IQPF.

About the Coalition for Professional Standards for Financial Planning:  Members of The Coalition for Professional Standards for Financial Planning have come together to work towards establishing a common set of national standards for  individuals who offer or claim to offer financial planning services.  Members include: Canadian Institute of Financial Planners (CIFPs), The Financial Advisors Association of Canada (Advocis), Financial Planning Standards Council (FPSC), the Institute of Advanced Financial Planners (IAFP) and the Institut québécois de planification financière (IQPF).   Each coalition member organization has a mandate that supports professional standards in financial planning, is committed to serving the public interest, and engages in the education, certification and/or oversight of financial planners.

See www.coalitionforprofessionalstandards.ca for more.

Notes to Editors:  See 'Statement of Principles" (backgrounder); photos of members signing the Statement of Principles available.

/NOTE TO PHOTO EDITORS: Photos accompanying this release are available on the CNW Photo Network and archived at http://photos.newswire.ca.  Images are free to accredited members of the media/

Statement of Principles of the
Coalition for Professional Standards for Financial Planners

Preamble

Financial Planning is the process of creating strategies to help people manage their financial affairs to meet life goals. Financial planning professionals are critical to furthering the collective financial health of Canadians. Financial planners provide much needed expertise, methodologies and guidance in making sound financial decisions and engaging in appropriate financial behaviors. Canadians rely on these professionals and their services.

The current regulation of individuals providing financial planning services is limited, exists in a piece meal form based on industry, and is mostly focused on regulations regarding the sale of product, not on the activity or the service itself. With a few exceptions (for example, Quebec, and to a lesser extent British Columbia) there are no restrictions on individuals using financial planning titles. Existing professional credentials are strictly voluntary, and there is no unified set of standards on which various financial planning credentials must be based. There is also no clear cut regulatory authority to oversee financial planning standards or the services of financial planners, and there is no single access point for consumers to file complaints.

The public must be protected from those who falsely claim to be qualified and subject to professional standards as financial planners but are not, from those individuals not acting in their clients' best interests and from those who misrepresent the terms "financial plan/planner/planning".

As a result, the Canadian Institute of Financial Planners (CIFPs),  Financial Advisors Association of Canada (Advocis), Financial Planning Standards Council (FPSC) and the Institute of Advanced Financial Planners (IAFP)  and the Institut québécois de planification financière (IQPF) have come together to form a Coalition for Professional Standards for Financial Planners ("the Coalition") to promote consistent standards required for individuals who offer or claim to offer financial planning services.

Points of Agreement Amongst the Coalition

Coalition members agree to the following principles:

1. Individuals must be held accountable to professional oversight if they:
   
  • Call themselves a financial planner or advertise a financial planning designation; or
  • Claim to offer financial planning services; or
  • Claim to prepare financial plans; or
  • Create an expectation that consumers are dealing with a provider of professional financial planning.
   
  This professional oversight is not meant to encroach on the activities of financial advisors or insurance advisors who routinely undertake needs analyses but who do not claim to be offering financial planning and who are not preparing formal financial plans, nor is it intended to take the place of the regulation of products and product-based advice.
   
2. In order to avoid conflicts of interest, this professional oversight of financial planners must be undertaken by organizations whose principal purpose is to serve the public interest.
   
The  individuals identified in item 1, above, must:
 
3. Meet the following minimum requirements before they can call themselves a financial planner:
   
  • Achieve a prescribed level of education related to financial planning;
  • Obtain a minimum prescribed amount of work experience related to the discipline of financial planning;
  • Pass a prescribed examination that demonstrates competence in financial planning;
  • Agree to be held accountable to a Code of Ethics, Practice Standards and rules and regulations of a professional body; and
  • Agree to engage in prescribed continuous education.
   
4. Meet the following minimum professional duty of care:
   
  • Put their clients' interests ahead of their own;
  • Act with the skill, care, diligence and good judgment of a professional;
  • Disclose all material facts including conflicts of interest;
  • Avoid conflicts of interest; and
  • Fully disclose and fairly manage, in the clients favour, unavoidable conflicts of interest.
   
  The professional duty of care set out above describes the obligations that a financial planner should owe to his clients in all situations, regardless of the specific engagement or nature of the relationship.

While this list of principles adopted by the Coalition is not meant to be exhaustive, the Coalition fully endorses these fundamental key principles as the basis for moving forward to ensure the public is well served by those offering financial planning services to their clients, and invites others who support the principles set out above to work with the coalition.   

SOURCE Coalition for Professional Standards for Financial Planners

For further information:

 

FOR INTERVIEWS AND MORE INFORMATION PLEASE CONTACT:   

CIFPs
www.CIFPS.ca
  Advocis
www.advocis.ca
  FPSC
www.FPSC.CA
  IAFP
www.IAFP.ca
  IQPF
www.iqpf.org
                 
Odele Burton
oburton@cifps.ca
647-723-6449
  Ann Walker
Awalker@advocis.ca
416-342-9838
  Eileen Chadnick / Chadnick Communications
Eileen@Chadnick.com
(416) 631-7437

Heather Mills / FPSC
(416) 593-8587 x 235
Hmills@fpsc.ca
  Ken Bates
kenbates@shaw.ca
250-665-6330
250-418-0616 Cell
  Liette Pitre
514-767-4040 or
1-800-640-4050 x 235 
lpitre@iqpf.org

 

Profil de l'entreprise

Coalition for Professional Standards for Financial Planners

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