What constitutes adequate professional development?
The Financial Planning Institute of Southern Africa (FPI), together with the South African Qualifications Authority (SAQA), recently released the findings from the research conducted to review the different approaches to Continuing Professional Development (CPD) practices across professional bodies.
The desktop research conducted analysed CPD practices across professional bodies in South Africa, Nigeria and in international countries including New Zealand, Scotland, Australia and Sweden, to better understand the CPD landscape in those markets.
FAnews spoke to Lelane Bezuidenhout, CFP®, Senior Certification Manager at the Financial Planning Institute (FPI) about the findings and the different views on professional development.
A lack of common language
The findings showed that the differentiation in CPD models is complicated by a lack of common language in describing the formal and informal practices.
Depending on which profession the professional body is representing, Bezuidenhout said some models include mandatory pro bono work (services to the public free of charge or at an absolute minimum charge) and others include formal, such as the attainment of a formal qualification, and informal training, such as attendance of a compulsory workshop, in their CPD models and practices.
“It is clear from the survey, that there are different CPD models and practices in place. However, one must realise that a statutory professional body; voluntary professional body and regulators will have different CPD models and practices in place as it represents from the engineering profession to the medical profession. The challenge is the different terminology and definitions used by various bodies. SAQA is looking at the possibility of developing a policy that will contain standardised definitions with the aim to support and guide the public, current and new professional bodies on CPD practices. The biggest difference between all the countries is whether input (where one simply attends a CPD seminar and merely receives a certificate of attendance without any assessment of what was learned) and output CPD (where the individual must complete an assessment) tests the attendee’s comprehension of topics trained during the CPD session,” she said.
Standards of the industry
Bezuidenhout said one first needs to understand what a CPD practice is. “It is the actual application and procedure followed when adhering to a profession’s CPD requirements. It is the way in which CPD hours are obtained and maintained. Is the CPD practice to link it with an intermediary’s Personal Development Plan (PDP) or it is to obtain specified specific CPD points in certain areas such as formal and informal training, input or output CPD,” she said.
Looking at worldwide trends, Bezuidenhout mentioned that there is a move towards output based CPD and having a plain language CPD policy in place that explains to the intermediary exactly what CPD hours or points are expected from him/her. Intermediaries should also consider that CPD is now also a fit and proper requirement (FAIS act section 6A and 8A as inserted via s. 180 and s. 183 of Act 45/2013) they need to comply with in the future. For more on the future regulatory requirement, it is suggested the reader refers to the FSB Newsletter 17.
“CPD is very relevant to an intermediary in that the intermediary will remain, in fact, must remain up to date with legislative changes, tax updates, ethics and practice standards training etc, to ensure that the customer is at all times treated fairly,” said Bezuidenhout.
“As is evident from the FSB’s above mentioned newsletter that the regulator is in constant liaison with industry in drafting a competency model that incorporates the local and international best practice principles and which will assist in achieving the market conduct outcomes in the future financial services context. The competency fit and proper requirement includes: Qualifications, Experience and Examinations needed in order to be an authorised FSP and/or representative. The regulator also engaged in conversations with SAQA in respect of SAQA’s requirements of:
- Recognised professional bodies,
- Their approach to qualifications,
- Professionalisation,
- Designations, and CPD.
The interaction between the FSB and SAQA is ongoing. It is important to note that the regulator is taking a lot of existing models and practices in place into consideration and that a lot of work is going into this process while they are drafting a competency model which will be sent to the wider industry for further discussion and consultation. It is clear that the regulator has the best interest of both the consumer and the industry at heart.”
Best practice
CPD is therefore concerned with up to date specialised developments and improving all-round performance which inherently involves a vision of lifelong learning, said Bezuidenhout. Taking all of the above into consideration, the mindset that an intermediary should adopt when it comes to continuing professional development, is not one of merely showing compliance with yet another requirement as laid down by legislation and/or regulation; but rather according to Bezuidenhout, one of:
- A continuous strive to ensure that your own professional knowledge is always up to date for the benefit of your clients and the public at large;
- That you continuously upskill yourself and remain informed with regards to the newest and latest developments in areas of financial management, asset management, risk planning, tax planning, retirement planning, estate planning and updates to legislation;
- In order to ensure that you remain relevant within the ever changing landscape of financial planning; and
- To ensure that you place your clients in a position to make informed decisions and that you are treating your customers fairly at all times.
“The current fit and proper requirements as we know it are under review by the FSB and the industry should be expecting to see new draft sub-ordinate legislation coming out for public comment in the near future. Again, reference should be made to the above FSB newsletter in this regard.
Editor’s Thoughts:
As Bezuidenhout said, it is essential that intermediaries continuously strive and upskill themselves in order to remain relevant. As for now, we should be keeping an eye open for the next public comment on fit and proper requirements.Please comment below, interact with us on Twitter at @fanews_online or email me your thoughts myra@fanews.co.za.
