FASEA must deliver on consultative process

If it was the intention of the Financial Adviser Standards and Ethics Authority (FASEA) to grab the attention of all Australia’s practicing financial planners then it certainly succeeded via the 14 December, 2017, release of its document – “Proposed Guidance on Qualification Requirements for Existing Advisers”.

Rarely has a document generated such an animated response and it was proof that there is nothing quite like a threat to someone’s career and livelihood to focus their attention on a particular issue – in this case the educational framework that will shape the industry over at least the next two decades.

The problem with the industry’s heated reaction and perhaps FASEA’s communication is that the framework is actually a work in progress with many months of consultation and horse-trading to take place before it is fully cemented into place.

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However, it was a measure of the consternation caused by the FASEA “Proposed Guidance” that the comments section on www.moneymanagement.com.au and other industry websites lit up as many already highly qualified and experienced advisers voiced concern that they might be forced to reclimb what amounts to an educational Mount Everest.

It was also a measure of their members’ responses that both the Financial Planning Association (FPA) and the Association of Financial Advisers (AFA) found themselves issuing reassurances about the strong advocacy they would be delivering via the consultative processes outlined by FASEA.

That consultative process will run until 28 June and it is worth considering what FASEA’s 14 December, 2017, statement actually said:

“The Standards Authority recognises that there are many variations of qualification and background in the Existing Adviser community and it is seeking views on the practical application of the proposed guidance.

“At this point, this proposed guidance is not intended to provide a definitive solution for every individual Adviser. It is intended to provide a recommended pathway of qualifications for Advisers.”

Elsewhere in its statement, FASEA said: “It is acknowledged that many Advisers are likely to have already gained a variety of education experiences, qualifications and potential certifications through their varying years of practice. In some cases, such education qualifications may provide recognition of prior learning options for Advisers.”

“In releasing this proposed guidance, the Standards Authority acknowledges that there will be more details and future examples to work through. A consultation process is intended to result in a list of FAQs and examples and FASEA will work with education providers, professional associations and other stakeholders to progressively develop practical examples of how the final guidance might operate.”

In other words, the FASEA statement should be taken for what it says it is – “guidance” – with its proposal around the FPEC register being subject to the key caveat that: “The Standards Authority recognises that there are many variations of qualification and background in the Existing Adviser community and will be seeking views on the practical application of the proposed guidance.”

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