“MOTs” for financial services executives would help rebuild trust and restore the reputation of the industry, says the CEO of the Securities & Investment Institute in London.
Firms in the financial services industry should consider introducing mandatory Continuous Professional Development (CPD) to develop their staff and help reassure and protect consumers amidst a serious loss of trust and reputation, says Simon Culhane, Chief Executive of the Securities & Investment Institute.
Speaking at the FSA on 25 January in London, Culhane pointed out that there is currently no method of verifying if someone with 20 years experience is up to date and competent to work in today’s fast-moving financial services industry. He called for an MOT or equivalent for those working in the financial services industry and suggested this take the form of a FIR* (Finance Industry Refresher).
The Securities & Investment Institute recently polled its 16,000 membership across the UK about their views on competence and testing. In his speech Culhane asked “Where does the financial services industry sit in relation to other industries and professionals in terms of CPD – ahead or behind the curve? SII research suggests we are behind the curve.”
The Securities & Investment Institute asked members “Are you part of a formal CPD scheme within your firm?” Only 44% said “Yes” and of those 96% were in compulsory schemes organised by their firms. If people were given a choice of joining a CPD scheme, only 60% did so.
Culhane quoted one SII member who said, “Ask yourself about confidence in airline safety if planes were flown in the same manner as financial products/services are managed/sold?”
The majority of SII members surveyed recognised that CPD is a crucial element in helping them retain competence: 75% of respondents felt CPD should be mandatory and there was strong support regardless of age or seniority.
The survey also asked “Was it reasonable to examine whether individuals are currently up to date and proficient?” Just over three quarters – 78% – said “yes”. The level of support from under 45s was consistent while those senior members were a touch more cynical, with 14% in the “don’t know” category and 20% were “against”.
Culhane concluded that a mandatory scheme alone would not be sufficient and that CPD refreshers needed to be embedded in every firm’s culture.