Continuing to evolve


With CPD becoming far more of an everyday feature of life in financial services, advisers and firms are busy considering how best to dovetail training and competence requirements.  The CISI take a closer look at this subject.

“Continuing professional development (CPD) is arguably as important as modernising qualifications – particularly if advisers are to continue to meet the future challenges and demands of the investment market.”

Those are the words of the Financial Conduct Authority (FCA) in its guidelines on professional standards. Advisers and investment managers, who are becoming accustomed to life after the Retail Distribution Review (RDR), will be well aware of just how crucial CPD is to the regulatory regime.

The Statement of Professional Standing (SPS), which is issued annually by the accredited body provided CPD and other application requirements have been met, will be familiar to anyone used to recording objectives, activities and outcomes in training logs from the pre-RDR days. The SPS has regulated the CPD requirements for advisers and investment managers in the retail sector to obtain the professional standard. It means that if you don’t have the SPS, you cannot continue to practise as a retail adviser. Of the 35 hours of CPD required under the SPS, 21 of these hours must involve structured learning.

The introduction of a regulatory requirement for retail advisers to undertake CPD brings a feature of life in other professions, such as accountancy, firmly into the financial services arena. Much of the industry was already subject to training and competence (T&C) requirements, although under this regime, firms verify that their employees are up to scratch without the need to demonstrate or commit to undertake a formal programme of CPD.

CPD is going to become much more of an everyday feature of life in financial services, partly due to regulation and partly because firms will voluntarily choose to encourage staff to undertake it even if they are not formally required to do so.

The CISI’s view
The changes that RDR brought to the retail advisory market are having wider effects across the industry, says CISI Managing Director Ruth Martin: “The RDR has been an engine for the great growth of interest in CPD. These changes have really propelled CPD to be a very significant feature of life in financial services way beyond those that are directly regulated as individuals.”

It is also clear, she says, that regulation is reinforcing this trend, for example in areas such as banking. In a consultation paper published in late July entitled Strengthening Accountability in Banking: A New Regulatory Framework for Individuals, the FCA set out proposals to amend the approved persons regime following the publication of the Banking Standards Review. This includes a recommendation that “firms must assess the fitness and propriety of those in the certification regime annually”.

“We would argue that this proposal has to include CPD and we suspect firms will see it as CPD too,” says Martin.

It seems clear, therefore, that CPD is going to become much more of an everyday feature of life in financial services, partly due to regulation and partly because firms will voluntarily choose to encourage staff to undertake it even if they are not formally required to do so.

There are concerns that some firms regard T&C as being equivalent to CPD, even though T&C is concerned much more with the basic rules that govern staff activities than with the broader and evolving knowledge of products and markets that formal CPD implies. However, Martin suggests this attitude is not universal. “Some firms will say it’s not just about what the regulator says. CPD isn’t just about compliance. It’s about taking responsibility and ensuring that you are the best you can be in the role you are in.”

The investment firms’ view
CPD should not be seen as an end in itself, done merely to tick the relevant requirements, but as part of the process of ensuring that the financial services industry in retail and beyond provides a professional service that customers can trust to deliver what they need. The way that dovetails with the training and competence requirements is now starting to exercise the minds of advisers and firms.

Five top tips for professional development
1. Plan ahead
Conduct an annual skills audit for yourself. Think about the areas where you have identified gaps in your knowledge and consider whether new legislation, rules, product developments and other changes have affected the area in which you operate.
2. Set your training goals
Work out a training regime to meet the requirements of your annual audit, but remember to allow time to cover unexpected developments during the year.
3. Use all available resources
Technology makes it easier to fit training into your schedule, through webcasts and computer-based training. Take advantage of the resources available from accrediting bodies like CISI. Be creative; watching a well-informed broadcast on the impact of Islamic insurgency in the Middle East can be a very useful way of updating yourself on how to assess market risk.
4. Spread out your training over the year
CPD training should be properly structured over 12 months. Remember the analogy of the footballer who trains every day to stay at the top of their game.
5. Work with others
Your company may have 400 investment managers whose basic CPD requirements will be similar, so organising company-wide courses may be an efficient use of resources. This will need to be topped up with more personally tailored training.

Andrew Cork MCSI, Senior Compliance Manager at Charles Stanley, uses a sporting analogy. “Professional athletes put in hours of practice each day to reach the top of their game and that is the way financial planners and investment managers should view their profession too. While there may have been a temptation in the past to simply tick the boxes, the need to demonstrate skills is now explicit in the regulated environment.”

Judith Ullock, Chartered MCSI, Training Manager at Redmayne-Bentley, says it is important for firms to have best practice measures and systems and controls that ensure individuals meet their regulatory requirements as well as aid their own personal development. “In addition to this, firms need to ensure that any training put in place is firm-wide, supporting both regulatory and non-regulatory requirements, and that both front- and back-office functions are covered,” emphasises Ullock. “It is also important to ensure that any training carried out meets the firm’s business objectives and is in line with the business plan.”

Cork says he spends a great deal of time examining FCA guidance, consultation papers and professional updates but he describes most of this as business-as-usual activity in order to be in a position to offer advice. “CPD can be personalised as well as formal or structured. Investment managers will need to keep up to date with modern retail practice and the tools they use. For example, if he uses a risk tool, he will need to model the application of that tool and how it informs the client experience.”

David Moland, Chartered FCSI, Head of Compliance at Arbuthnot Latham, says that the advent of the SPS has encouraged registered individuals to focus much more on CPD, but he believes that people are not necessarily undertaking the kind of training they really need to do. “There is still an element of feeling it is something they need to do [to comply], rather than something with a pre-defined end in mind: for example, learning about structured products.”

Moland thinks firms can help their employees in this regard by encouraging them to see training as part of the job, releasing them from work commitments where necessary. He adds that institutes such as the CISI are making greater use of technology, for example by putting webcasts of conferences and seminars on the internet to help those who could not attend catch up. While Moland is not formally required to do CPD as he is a compliance officer, he chooses to do so to ensure he keeps up to date.

The accountants’ view
CPD is required by most other professions but other systems have evolved in different ways. The Institute of Chartered Accountants in England and Wales (ICAEW) does not insist on a set number of hours but requires: “As much development activity as you feel is required to remain competent in your role.” This can include anything from reading the Institute’s email alerts for news and updates relevant to your role and participating in the ICAEW community to formal training courses. The Law Society requires 16 hours, while doctors’ CPD requirements vary according to their Medical Council.

While the ICAEW’s CPD philosophy sounds rather casual, its stricture is worth bearing in mind: the RDR requires advisers to know the market on which they are advising their client. That means being equally familiar with the more esoteric areas as well as mainstream products. Keeping abreast of them requires more than just keeping up to date with money laundering rules; it means embracing CPD as a way of life.

To learn about the CISI’s CPD scheme, visit

Further Information

  • CISI Professional Refresher Modules: Training & Competence,  T&C Supervision Essentials
  • CPD Training Course: Training & Competence Health Check, 3 February 2015

About Author

The Chartered Institute for Securities & Investment is the leading professional body for securities, investment, wealth and financial planning professionals. Formed in 1992 by London Stock Exchange practitioners, we have a global community of circa 40,000 members in 116 countries and last year more than 40,000 CISI exams were sat in 80 countries, 15,000 taken outside the UK.

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