Organisations such as the Financial Planning Association (FPA) may have committed to achieving professional status, but the broader Australian financial services industry is falling a long way short of the mark.
That is the assessment of the Professional Standards Council expressed in a submission to the Parliamentary Joint Committee Inquiry on Corporations and Financial Services which has revealed that it undertook a research project into the professionalisation of financial services and found the results to be “concerning”.
Further, the research findings suggested professionalism was unlikely to succeed without substantial Government intervention.
It said that it had entered into the research project assuming that a coordinated strategy for Financial Services professionalisation might already be underway in response to the frequency of public inquiries and the call to action from the community and media.
However the submission said it was clear from the research that while steps had been taken and that some communities had invested heavily in the process of advancing professionalisation and others intended to expand their existing professional systems, “it is also clear that his is limited to a few communities within the ecosystem of Financial Services”.
It said that professionalisation (in the larger construct of standards and regulation oriented to consumer protection and higher duty) “has not been defined or universally committed to by the whole industry”.
The submission said the results were surprising in that they revealed the project to professionalise the financial services was:
• Less progressed than was expected
• Hampered by a lack of unified understanding of professional standards and regulation
• Hampered by Association cost concerns and distorting competition pressures that discourages leadership in self-regulatory action
• Hampered by resistance to community engagement and a reactive approach to regulatory engagement that has a distorting and negative affect on pursuit of collaborative solutions.
• Unlikely to succeed without substantial government intervention and a sponsored strategy for professionalisation.