Re: The wrong side of history, editorial, Investment Executive, May, 2016
Advocis has long been in favour of establishing higher and consistent standards for financial advisors that ensure all Canadians — regardless of their income or where they live — can have confidence in the quality of the financial advice available to them and that their interests are protected and held paramount.
Since we formally called for the establishment of a legally recognized profession in 2013, our industry has continued to operate within regulatory gaps. At this point, we wholeheartedly agree that it’s time for all industry players to unite and fully embrace “the mantle of true professionalism.”
Above all, Canadians deserve to know that anyone who holds themselves out as a financial advisor is subject to a common and rigorous set of regulatory requirements. They should be able to trust that the advisors they deal with have the competence and knowledge to help them meet their financial goals. Unfortunately, today that is not the case, as anyone in Canada, irrespective of their education and training, can use the title of financial advisor with impunity. This not only leaves investors vulnerable to a few bad apples, but it also does a disservice to our industry and to the thousands of dedicated and knowledgeable advisors who put the interests of their clients above all else.
Creating a profession for financial advisors will put us on the right side of history. The best way to ensure that trustworthy financial advice is accessible to Canadians is to oversee financial advisors as we do all other professionals who provide essential advice — from doctors and lawyers, to engineers and accountants. Today, this is more important than ever as Canadians are forced to be more financially self-reliant in retirement, while financial products grow exceedingly complex and financial literacy is declining.
The time has come for all financial advisors, across every sector, to belong to one professional body and be required to adhere to a code of professional and ethical conduct, mandatory professional liability insurance, ongoing continuing education and a disciplinary process that has the authority to suspend an advisor who has wronged an investor. If we follow this path, we can establish ourselves as trusted professionals in the minds of those who depend on us. And don’t Canadians deserve to be served by true professionals?
Greg Pollock is president and CEO of Advocis, The Financial Advisors Association of Canada.
Read a response to this letter from a portfolio manager: Confusion at Advocis? May 10, 2016.