A merger between Association of Financial Advisers (AFA) and Financial Planning Association of Australia (FPA) is “not off the table” but will be driven by their members’ demands.
Speaking at the AIA Adviser conference, the two organisations said they were already working closer than ever on behalf of their members.
While they would remain as separate entities for the time being, there could be a possible merger if it would be of the benefit of members.
Marisa Broome, chair at the FPA, said: “Our focus in on member services at the moment and providing services to members who are in a broad style of business and style of advice. But if our members tell us they would want to merge, then it is not off the table. We are member-led so will certainly go back to members and follow the type of things they want us to do.
“But we do work closely together and its powerful having two organisations with a similar message going into meetings with key stakeholders. But the minute it stops being powerful, maybe we would be better together.”
Sam Perera, national president for the AFA, added the two firms already worked jointly in various capacities including meeting with regulators.
“We have been working more closely than I believe we have ever worked and have a great working relationship. We’ll continue to work closely together to benefit the members of the sector and the sector deserves us to do that.
“If I was to talk to the sector and the advice community at large, I think they would say the AFA and FPA need to work together in terms of a stronger voice which will broaden representation and pull together resources to try and get some wins that the industry desperately needs.”
Comments
The problem with FPA being a "member led organisation" and being driven by "member requirements", is WHICH members??
Less than half of the FPA's members are practicing professionals who have completed the CFP course in addition to a degree. Surely these people are the ones who should be driving the future of the FPA and the financial planning profession as a whole?
But the FPA is dominated by hangers on who are either not practicing planners, are poorly educated, or are salespeople for the vertically integrated product companies who pay their membership fees in bulk. No wonder politicians and regulators ignore most of the FPA's lobbying.
Financial planning doesn't need a merger of two industry associations, it needs a genuine professional association. At the moment that doesn't exist.
Very well put especially the call for a genuine professional association.
CFPs should, and actually do, take the lead often through Member input often individually or through FPA Committees. If you haven't done this, that's on you.
ASIC is currently open to submissions on CP 359 RE FSCP. AS a CFP, I'm helping a group write a submission to try and get a sensible result. You could do the same or otherwise just complain about the outcome anyway.
AFP Members are also usually practicing. So the bulk of FPA members do advise.
Bulk membership payments, and many hangers on, are largely gone with the demise of much of the large retail advice groups (you know who and good riddance to them).
Most FPA members are practicing. But a large minority aren't.
Most CFPs completed the CFP course. But a large minority didn't.
Most FPA members pay their fees directly themselves. But a large minority don't.
It is all these large minority segments that hold the FPA back from being taken seriously as a professional association. Apologists keep saying "Don't worry, they'll work their way out of the system eventually. Doctors and accountants evolved into established professions over time and so will financial planners." The big flaw with this argument is that professionalism and higher education were well established concepts by the time financial planning started, and were readily attainable for those who chose to make the effort. They were also perfectly reasonable for consumers and regulators to expect.
It was a mistake that the FPA didn't insist on professionalism much earlier. It's unbelievable that they still haven't insisted on professionalism today.
There is an obvious way the FPA can switch from being an industry association to a professional association.
Restrict voting rights, office holders, and policy input, to qualified (not grandfathered) CFP practitioner members only. Let all the others stay as fee paying associate members if they want, but with zero control or influence over the organisation. And insist that all members pay their fees directly as individuals.
Yes, this will cause a decline in membership and revenue. But that will also be a good thing because it will force the FPA to ditch all those superfluous staff and programs that have no place in a genuine professional association.
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