Having faced a wave of domestic government regulation since the global financial crisis, financial planners need to forge a new relationship with authorities, representatives of the FPSB – of which the Financial Planning Association is a member – told press at the FPA Congress in Sydney yesterday.
The FPSB – which owns the Certified Financial Planner designation – became a member of the International Organization of Securities Commissions (IOSCO) in October 2012; a position which FPA chief executive Mark Rantall said will give the member associations “influence” with global regulatory bodies.
United States FBSB chief executive Noel Maye told the press briefing that IOSCO – of which the Australian Securities and Investments Commission is a member – is increasingly aware of the role of industry associations in driving professional standards, as opposed to legislative deterrents.
“Regulators are coming to the realisation that you cannot legislate ethical behaviour,” said Mr Maye, who heads up the FPSB’s international headquarters in Denver, Colorado. “You can make laws – but it’s actually the professional bodies that drive interest in ethical standards.”
The representatives were buoyed by the example of the United Kingdom, where several aspects of the FOFA-like Retail Distribution Review (RDR) legislation were “watered down” following lobbying from industry and engagement with the national authorities, according to UK FBSB chairperson-elect Barry Horner.
“[In the UK] government recognised the inevitability that people weren’t going to be able to transition from commission to fee and they realised the drop in [planner] numbers and thought ‘Where will that leave the public?” Mr Horner said.
Mr Maye concurred that effective lobbying, engagement and initiative in raising educational/professional standards can ultimately influence government regulatory bodies.
“As a profession let’s put the consumer centre and then look at product and get regulator’s trust back,” he said.
