The FPA is preparing for a potential influx of new members, should a PJC recommendation to mandate professional association membership get government approval.
At a media briefing in Sydney yesterday, FPA chief executive Mark Rantall reflected on the recent Parliamentary Joint Committee on Corporations and Financial Services (PJC) report, which recommended that “any individual wishing to provide financial advice be required to be a member of a professional body”.
Should the government approve the recommendation, its Professionals Standards Councils – of which former FPA staffer Dr Deen Sanders is CEO – will assess applications from industry bodies seeking ‘professional status’, and Mr Rantall said the FPA is currently preparing its application.
FPA general manager, policy and conduct, Dante De Gori told the same briefing that while the FPA stands to gain considerably from the proposal – which could see its membership grow from 10,000 practitioner members to as many as 18,000 – other stakeholders may also benefit, including rival associations.
“It would provide a great opportunity for the FPA but it also provides a great opportunity for any association and sets a criteria so we have a level playing field, because at the moment there are a lot of associations or groups in the market and the consumer is none the wiser as to whether those groups have any standards as to training and ethics,” Mr De Gori said.
“We feel we have higher expectations for our members and that recognition needs to be provided to our members; they don’t get the recognition they deserve by putting in that effort.”
If enacted the PJC recommendations would also see the enshrinement of the terms ‘financial adviser’ and ‘financial planner’, the FPA execs said, since only advisers listed on the government’s register would be permitted to practice.
Asked whether the FPA is worried that compulsory membership could result in an influx of ‘bad apples’, Mr Rantall said it is a legitimate concern but that the association is prepared.
“The reality is, it is far better to have people in so we can influence them, rather than having them sit outside,” he said.
“Some advisers are not members of any professional association, so where are they getting their professional standards and ethical training from? To not have it, given the noble purpose of financial planning and the impact it has on consumers, is an indictment.”
Mr Rantall also called for caution, stressing that the PJC recommendation is only a proposal and that the “devil will be in the details”.
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