By Kobus Kleyn, Certified Financial Planner

F i n a n c i a l P l a n n i n g

Top financial advisers display a passion for the advice profession

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Product floggers no more!t gives me great pleasure to write this article on a topic for The word industry is appropriate if we view our daily task as which I have the greatest passion and I hope that my I that of producing or manufacturing policies. If that is how we thoughts will resonate with my fellow financial advice behave – and we leave our clients with the lasting perception professionals as well as intermediaries and other stakeholders that we are product salesmen rather than advisers – then we within the industry.cannot expect them to call us financial professionals nor refer

to our industry as a profession.The starting point for this discussion is that financial planners –

as professionals in the financial services sector – have the The reality is that professionals are the exception in the power to change people’s lives. Those of us who offer advice current environment. There are approximately 113000 with passion deserve the respect and status that our clients intermediaries registered in South Africa, including 40000 long and potential clients confer upon us. By providing a term advisers and only 4700 Certified Financial Professionals.professional service there is no reason that we should not be

viewed in a similar light to those in the legal and medical Within this small subset of the advice community there is a professions.handful – at best – who can refer to themselves as financial

planner professionals operating within a financial advice From industry to professionprofession. But we will have to wait until after the Retail I refer in the opening paragraphs to both a profession and an Distribution Review (RDR) process to find out who can industry and would like to expand on these concepts. The actually refer to themselves as financial planner Oxford Dictionary defines industry as “economic activity professionals. concerned with the processing of raw materials and

manufacture of goods in factories.”

The intermediary environment is complex and there are those Profession, meanwhile, is defined as “a vocation founded

who specialise in various areas such as short term insurance, upon specialised educational training, the purpose of which

long term financial planning and healthcare and it is difficult is to supply objective counsel and service to others, for a

at this stage to blanket each of these areas with the word direct and definite compensation, wholly apart from

profession.expectation of other business gain.”

Developing a lobbyist mind-setA profession arises when any trade or occupation transforms

There is however scope to define our profession within certain itself through the development of formal qualifications based

categories of advisers and we should all work towards this upon education, apprenticeship, and examinations as well

objective. In fact organisations such as the Financial as the emergence of regulatory bodies with powers to admit

Intermediaries Association of Southern Africa (FIA) and the and discipline members according to a code of conduct.

Financial Planners Institute (FPi) should be playing a major role

in lobbying the regulators and other industry stakeholders to It would be difficult for any client to consider us part of a

convert us from an industry to a profession.profession if we refer to ourselves as an industry rather than a

profession. If we wish to afford our profession more status and

This brings me to the next point of discussion – namely the role respect we may have to change how we refer to ourselves.

that associations and representative bodies play within our

“The FIA – an association for the country’s risk and financial advisers – is committed to improving and promoting the image, integrity and standing of the financial intermediary”

F i n a n c i a l P l a n n i n g

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profession. There are well-established organisations both My belief, which is shared by many of my fellow MDRT

locally and abroad whose role it is to enhance our members, is that we can all learn from the incredible

professional status and ensure the long term sustainability of operating practices that our international MDRT counterparts

our profession. The words professional and profession are apply. This is especially relevant now that RDR is upon us, as

certainly appropriate considering the impact we have on many MDRT members practice in markets where RDR has

both the financial wellbeing of our clients and the broader already been implemented, including Australia, Denmark,

economy. the United Kingdom and Singapore.

The FIA – a trade association for the country’s risk and It is imperative that each of us join the FPi, FIA and MDRT as

financial advisers – is committed to improving and promoting and when we qualify to do so and to work from within these

the image, integrity and standing of the financial institutions to convert our industry to a profession. Each of

intermediary. It is an organisation that represents these premier associations has complimenting Code of Ethics

intermediary interests to the regulator as new regulation is and Conduct to promote the highest quality standards

developed and implemented so as to ensure fair outcomes amongst their respective memberships.

for members’ practices.

Unity is strength

They represent intermediaries – whether they are The existing entities are more than adequate to achieve the

independent financial advisers, brokers or tied advisers – multiple goals of our professionalism within a sustainable

regardless of size and regardless of the financial services profession as well as the protection of consumers. We should

discipline they are involved in. The FIA is certainly proving their certainly not be distracted or manipulated into joining the

mettle by representing intermediary interests to the Financial new and opportunistic associations that are being formed

Services Board, National Treasury and the Council for under the cloud of fear introduced by RDR. This would simply

Medical Schemes through the lengthy Treating Customers dilute our combined representative powers with the regulators.

Fairly and RDR implementation processes.

Earning the regulator’s respect

From my personal experience we can rest assured that the

FIA will not let us down. They earned the respect of the FSB

during the implementation of the FAIS Act and the

subsequent regulatory examinations and continue to

command this respect through their frank interactions with

the regulator on current matters.

The FPi is the independent professional body (or

accreditation body) for financial planners in South Africa. As

a non-profit professional body and founding member of the

international Financial Planning Standards Board (FPSB) they

exist solely to improve the level of professionalism through the

quality of advice delivered by us to the consumer. They also

issue the CFP® mark to those of us who meet their stringent

qualification and competency requirements.

The FIA and FPi are two great local entities that represent

financial professionals’ interests within South Africa – and they

are doing a great job. It is however my opinion that we also

consider international associations such as the Million Dollar

Round Table (MDRT) to further complement our professional

status and profession.

A global support base

MDRT, the Premier Association of Financial Professionals®, is a

global, independent association of the world's leading life

insurance and financial services professionals. Its members

demonstrate exceptional professional knowledge, strict

ethical conduct and outstanding client service.