Financial Advice New Zealand has said the newly approved Code of Conduct has lost an opportunity for the sector with inconsistent qualification requirements.
It claims the Code has “fallen short” in the crucial area of qualifications and professional development.
“While we are supportive of many areas of the Code and applaud the straight-forward structure and language, we remain disappointed that the Code does not require a minimum qualification for all persons providing regulated financial advice, or a minimum requirement for CPD,” says Chief Executive, Katrina Shanks.
“A key objective of the new regime is to build public confidence and trust in the financial services sector: ensuring that New Zealanders deal with qualified people is an absolutely crucial component in this.”
Shanks explained the association does not believe the Code best serves New Zealanders in how it will set up a two-tiered system of advisers via a mandatory qualification for ‘individual’ financial advisers, and ‘equivalence’ for nominated representatives.
Regarding CPD requirements, Shanks said that commitment to ongoing professional development is a cornerstone of professionalism.
“It is fundamental that an adviser ensures they keep their key competencies and knowledge up-to-date. The Code ought to have a minimum level and require ‘any additional CPD’ to maintain competency,” she said.
Although noting that the inclusion of ‘not applying undue pressure on clients’ in Standard 1 was a positive, as it is a requirement which supports an advice rather than sales centric approach to client’s needs, Shanks said she was surprised that the Standard no longer included the language “act in their (client’s) interests”.
“Putting the client’s interests first is a cornerstone behaviour of professionalism, and as such should be reflected in the Code of Professional Conduct,” said Shanks.