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Tim Sargisson: Why chartered status matters less than your culture

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Last month, Wingate Financial Planning director Alistair Cunningham wrote an article in Money Marketing arguing that chartered status had been cheapened, citing high-profile incidents of chartered financial planners involved in poor advice as one reason why.

For the record, Sandringham is not currently chartered. The question for us and other non-chartered firms remains whether there is any benefit in becoming so.

This is not designed to demean any person or firm that has put in the effort to reach the pinnacle of their professional development.

I follow the path of our own chartered planners with interest and the drive behind establishing the Sandringham Academy in association with Redmill Associates was to support those who wanted to work towards Level 4, 6 and, ultimately, chartered status.

However, columns like Cunningham’s add to the debate about what tangible benefits there really are.

The first key issue is that it is all about the client. Cunningham’s article questions whether some advisers view a string of qualifications and titles as perhaps superseding the need to deliver good client outcomes. The two should go hand in hand but Cunningham’s point is that sometimes they do not.

I would argue that the business culture is more important than titles. I appreciate that, to be chartered, the firm must have in place core values and business practices that align with the Chartered Insurance Institute code of ethics, but they need to go further.

It is all about delivering great client outcomes. Every business needs a clear mission statement, combined with a core focus and a set of core values, all of which reinforce how the client is at the heart of the firm.

Our mission statement, core focus and values are included in our employee handbook to ensure staff understand this from the moment they join us.

We ask that staff judge the management in terms of how we treat clients against these values; to let us know if they believe we are not delivering. Putting a plaque on the wall is irrelevant if it is not accompanied by a focus on outcomes acknowledged by everyone in the business.

The second point is about whether it helps client engagement. Providing a level of comfort by being chartered is not the same thing as actively encouraging new clients to seek you out because you are chartered.

Clients are just as likely to respond with “so what?” when offered the facts. This is as much to do with the way we present the facts, with very little in the way of “why” a firm is chartered and how it supports the delivery of good outcomes.

For us, though, all of this is largely academic. This is because to qualify for chartered status, a minimum of 25 per cent of the firm’s advisers must hold the chartered financial planner title, which will increase to 50 per cent by 2020.

I suspect this sits well with most firms where, according to the FCA data, 89 per cent have five advisers or fewer. However, for the 38 firms with 50-plus advisers, it is challenging to deliver the requisite number qualified to be able to join the club. This means, for the time being, we will have to direct our efforts elsewhere.

Published on 11th January 2019

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