New Thinking In Professional Development For Financial Advisers
Compliance & Financial Advice & Professional Services

New Thinking In Professional Development For Financial Advisers

January 10, 2020

by Tony Vidler  CFP logo   CLU logo  ChFC logo

One of the positive changes for financial advisers in this part of the world in the last year was a broadening of what can be considered Continuing Professional Development (CPD). Now, instead of solely focussing upon technical learning, we are entering a regime where advisers have to map out their own professional development plan to include hard and soft skills and taking into account the type of work that they do, or want to do.  This means that learning (say) negotiating skills can be part of a structured professional development plan for an adviser, and contribute to their annual CPD requirements.


This is an excellent shift in regulatory thinking, and a positive contributor to developing financial advisers with better commercial acumen and people skills.


Interestingly though, a lot of advisers haven’t quite grasped the concept as yet of being able to expand their skills beyond technical competency.  We could perhaps take a note of an excellent insight aimed at the youth of today, and use it for our own professional development.

This seems to me to be an excellent approach to the new thinking around what professional development an adviser should pursue.  To paraphrase it we should ask:


what do I need to learn or be better at to work with the types of clients and issues that I’d really enjoy working with?


I think that regardless of what the CPD obligations are for any financial adviser there is wisdom in thinking far more broadly about one’s professional development.  As reform has been wheeled out across the industry the focus has understandably been upon ensuring minimum technical competence in the sector.  Reform will undoubtedly continue to focus on elevating technical and academic standards in years to come as a means of raising the the perceived professionalism of the financial advice industry as well as ensuring that all practitioners have a solid knowledge base to work with.

But will it help advisers do a better job of providing professional advice to consumers?

It should…in part.  And therein is the catch with CPD.  Additional academic learning and increasing technical proficiency does help make better practitioners without doubt in my view.  Robust and rigorous learning helps develop critical thinking and objectivity, and provides a sound base of knowledge from which to identify appropriate strategies and tactics for clients.  It is therefore an essential element in developing a profession of objective, competent and rational professionals.


Our primary function however is to deal with irrational, opinionated and financially naive or ignorant consumers much of the time.


Simply focussing CPD upon technical competency presents the risk of developing a profession which may well be consistently “right” in its advice, but one which consumers would prefer to avoid dealing with.  Objective righteousness, which is delivered dispassionately for the customers own good, regardless of how they feel about it, begins to sound a bit like the legal profession. That’s pretty popular with consumers, isn’t it?


The point in highlighting that is not to criticise the emphasis upon academic learning, but to help put it in its proper perspective.  Just because that is the focus of the regulators doesn’t mean it should be the focus of the advisers.  Of course we need to do whatever is prescribed to be allowed to play in the game – but is that the same as charting your own course and learning what you need to learn to do the work that you’d truly love to do?


So, a big hat-tip to the NZ regulators for recognising that there is a need to balance the development of professional advisers by enabling them to develop both hard and soft skills as part of becoming better advisers.  To be truly effective,  financial advisers do need strong technical knowledge together with great people and commercial skills.  You need all three to develop rounded professionals whom consumers wish to engage with.


So what do the people you want to work with want you to know and be able to do?

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