Executive Summary
After giving a ‘sneak preview’ in early 2014, this week the CFP Board formally launched its new Center for Financial Planning, a “virtual entity” within the CFP Board that aims to support the future of the financial planning profession.
Armed with a multi-million-dollar founding sponsorship from TD Ameritade, the Center for Financial Planning will focus on attracting and developing the next generation of financial planning professionals, improve gender and racial/ethnic diversity amongst financial planners, and provide a home for financial planning academics, including the launch of a new Wiley-published academic journal for financial planning researchers to publish and get credit towards tenure.
Yet while these are laudable goals for the CFP Board to pursue, it is notable that the new Center for Financial Planning initiatives move the CFP Board into even further conflict with the FPA, which similarly has its own NexGen effort, its own diversity initiative, its own partnership with the Academy of Financial Services to provide a home to academics, and its own Journal.
In fact, the Center for Financial Planning’s vision to become “the premier resource in the financial planning profession for educators, researchers, practitioners, financial services firms and the public“, combined with the CFP Board’s effort to raise a whopping $10M of capital for the organization in the next five years – far in excess of what it needs to operate its current initiatives – raises the question of whether the CFP Board is seeding the Center of Financial Planning to become a competing membership association against the FPA, just as the FPA’s own market share of CFP certificants continues to sink to record lows.
Given the CFP Board’s long history of its own debacles, arguably in the long run it is better to have a strong and vibrant FPA operating as a membership association outside the CFP Board, and functioning as a check-and-balance to hold the CFP Board accountable. But with FPA facing its own woes as revenues continue to decline, and the potential Department of Labor fiduciary proposals risking a disruption to FPA’s own crucial sponsorship revenues, the CFP Board appears to be positioning itself for the possibility that the FPA may stumble… and perhaps is even trying to compete and hasten the FPA’s demise.
The CFP Board’s Center For Financial Planning – Sponsored By TD Ameritrade
This week, the CFP Board formally launched its new Center for Financial Planning, an initiative that was initially announced early last year but took over 18 months to fully take shape.
The declared purpose of the Center for Financial Planning is “to ensure a vibrant, sustainable future for the financial planning profession” with a focus on: creating a sustainable (and more diverse) supply of advisors to replacing those who will soon retire; conducting third-party research; building a repository of the financial planning body of knowledge; providing a home to financial planning academics; and convening a wide base of stakeholders to achieve these outcomes.
The Center for Financial Planning will be funded by a massive “multi-million-dollar multi-year” lead founding sponsorship from TD Ameritrade, and also includes contributions from individual donors as well. Additional corporate sponsors will be solicited in the coming year as well, and CFP Board CEO Kevin Keller has indicated a goal of raising $10M to $12M in the next five years.
Expanded And New Initiatives Of The Center For Financial Planning
Initially, the Center for Financial Planning will focus primarily in the areas of workforce development (attracting and developing the next generation of financial planning professionals), diversity (improving both gender and racial/ethnic diversity within the financial planning profession), and establishing a home for the growing base of financial planning academics teaching and doing research in financial planning.
Notably, the CFP Board has already made efforts in several of these areas. Late last year it launched a Career Center sponsored by Fidelity to support workforce development, and has spent nearly a decade ramping up the growth of financial planning undergraduate and graduate school programs (which now number a whopping 140 baccalaureate programs with 45 more in development, up from only 54 programs in total just 15 years ago!). Last year, the CFP Board launched its Women’s Initiative to increase the percentage of female CFP certificants above the 23% threshold where it has hovered for over a decade. And the CFP Board already supports financial planning academics with both an annual Program Directors conference for financial planning academics, and publishing the Financial Planning Competency Handbook.
All of these existing initiatives will be housed under the CFP Board’s new Center for Financial Planning, along with additional programs that will roll out in the coming years. The CFP Board has indicated that it will convene a “design summit” in early 2016 to delve further into deciding what the Center’s structure and programs will be in the future, though a new racial/ethnic diversity initiative to complement the Women’s Initiative is already planned.
Launching A New Journal For Financial Planning Academics
Also included as part of the Center for Financial Planning’s already-announced new initiatives is the launch of a new journal for academic research on financial planning.
While other journal publications already exist – from the Journal of Financial Planning published by the FPA, to Financial Services Review published by the Academy of Financial Services – the primary challenge of those publications is that professors seeking publishing credit for tenure, particularly at AACSB-accredited business schools, often get little or no “credit” for research in these publications. Unfortunately, while both are peer-reviewed publications, they are not viewed as “competitive” enough compared to other business journals, and the Journal of Financial Planning is further adversely impacted because it operates as a ‘blend’ of academic journal and industry trade magazine.
The CFP Board hopes to fill this gap with its new Journal offering, which will be published by Wiley (the organization that also publishes respected Journals like the Journal of Finance, and many of the AICPA’s Journals as well). Ultimately, the goal is not only to support a wider and deeper range of financial planning research to advance the professional body of knowledge, but also to encourage business school academics to adopt and advance financial planning programs by providing a “reputable” journal in which they can publish actual financial planning research and earn academic tenure credit.
The new Journal has yet to receive a formal name, and still awaits the appointment of a formal editor, but will ostensibly launch sometime in 2016.
Governance And Structure Of The Center For Financial Planning
Although dubbed with a unique standalone name – the “Center for Financial Planning” – the CFP Board has indicated that ultimately the organization will simply be a “virtual entity” housed within the CFP Board’s existing infrastructure. Although currently supported by existing CFP Board staff, Keller indicates that future staff are expected to be hired, both to lead the Center’s various initiatives, along with an editor to direct the new Journal. On the other hand, the significant fundraising effort of the Center should avoid any need for the staffing and infrastructure of the Center to impact ongoing CFP certification dues (as a multi-million dollar fundraising effort should be more than ample to cover the handful of staff that would be needed to support the Center’s currently proposed initiatives).
The leadership/governance structure of the Center will include an advisory council (to be formed after the design summit) for directing programs and providing guidance to CFP Board leadership, supported by a second advisory council to direct specific initiatives (e.g., for diversity), and a development committee for additional fund-raising.
Center For Financial Planning To Support The Future Of The Financial Planning Profession
In a world where the CFP Board has historically focused all of its effort on establishing and maintaining the CFP marks and not necessarily championed the broader financial planning profession – a focus consistent with its mission, but one for which it has often been criticized – the CFP Board’s shift to supporting the advancement of the financial planning profession is notable. As the Center notes on its new website, its ultimate vision is “To be the premier resource in the financial planning profession for educators, researchers, practitioners, financial services firms, and the public” with a mission focused on “building capacity for the financial planning profession” along with “building a body of knowledge and an academic home to support the growing discipline of financial planning”.
In this context, the CFP Board’s effort is laudable, and helps to fill the gap in several crucial areas. Although it will take years to fully establish credibility, a bona fide ‘academic’ journal able to generate tenure credit for professors in AACSB-accredited business schools is a significant step in expanding financial planning into business schools and higher-tier academic institutions. And diversity – in terms of both gender and racial/ethnic inequality – has been a long-standing issue for both financial planning in particular, and the broader financial services industry.
The CFP Board’s efforts to further attract and retain younger professionals into financial planning is equally crucial for the long-term viability of the profession – an area where the CFP Board has already made notable progress, as while there are still more CFP professionals in their 70s than their 20s(!),the CFP Board recently announced that the average age of a CFP certificant is finally beginning to decline, and has dipped under age 50 for the first time in many years. Continued efforts to increase the number of undergraduate and graduate students coming into financial planning programs, and then encouraging them to sit for the CFP exam and actually become financial planning practitioners, is crucial for the long-term growth and viability of the profession.
The Converging Collision Course Of The FPA And The CFP Board
On the other hand, while the CFP Board’s efforts to improve diversity, workforce development, and the academic base of financial planning are laudable, the fact that it’s the CFP Board making the effort – albeit through its new Center for Financial Planning – puts the organization in ever-increasing competition with the Financial Planning Association.
For instance, while the CFP Board has announced an intention to grow a diversity initiative (to complement its Women’s Initiative), the FPA already has a diversity initiative. The CFP Board will engage in research on how to improve and advance the financial planning profession, but the FPA already has its own Research and Practice Institute. The CFP Board will now provide a financial planning research journal, but the FPA already has a financial planning research journal, and when the FPA expanded its relationship last year with the Academy of Financial Services to support the Financial Services Review Journal it was the CFP Board that pre-empted the news with its own Center for Financial Planning announcement – despite the fact that we can now see the CFP Board was still over 18 months away from being ready to launch
And these conflicts between the CFP Board’s new initiatives and the FPA’s existing programs are simply an extension of other recent CFP Board expansions into the FPA’s role as a membership association. For instance, the CFP Board also launched its Career Center late last year, but the FPA has had its own financial planning Job Board for years. And of course, there’s the CFP Board’s ultimately-thwarted attempt to become a CFP CE provider that would have put it directly into competition with the Continuing Education events and programs that are the financial lifeblood of the FPA.
And notably, in a world where the CFP Board and the FPA will be engaged in simultaneous initiatives, the CFP Board is still a significantly larger organization, with 73,000 CFP certificants as a base, compared to “just” about 24,000 FPA members (of which only roughly 18,000 are CFP certificants). According to their respective Form 990s, the FPA runs an annual budget of just over $9M, with just under $3M in net asset reserves, while the CFP Board operates its core on almost $15M of revenue and a total of nearly $30M including the dollars it allocates to its public awareness campaign, plus a $23M war chest of reserves. And the CFP Board’s new fundraising efforts for the Center for Financial Planning only gives it even more of a financial and resources lead to outpace the FPA in its own initiatives.
In other words, the CFP Board has far more resources to deploy towards the success of its ever-converging collision course with the FPA, as the CFP Board increasingly expands its role from being “just” the credentialing organization for CFP certificants, to becoming the central organization for the financial planning profession. This collision course is perhaps most directly shifted by the shift in its vision, as while the CFP Board has remained focused on the CFP marks, the vision of its the new Center for Financial Planning is remarkably close to the FPA’s own:
CFP Board of Standards Vision:
The mission of Certified Financial Planner Board of Standards, Inc. (CFP Board) is to benefit the public by granting the CFP certification and upholding it as the recognized standard of excellence for competent and ethical personal financial planning.
Center for Financial Planning Vision:
To be the premier resource in the financial planning profession for educators, researchers, practitioners, financial services firms and the public.
Financial Planning Association Vision:
The Financial Planning Association is the principal professional organization for CERTIFIED FINANCIAL PLANNER™ (CFP®) professionals, educators, financial services providers and students who seek advancement in a growing, dynamic profession.
Is The CFP Board Seeding A Future Competing Membership Association?
Perhaps most notable of all, though, is the CFP Board’s massive fundraising effort for the Center for Financial Planning, including the initial multi-million-dollar commitment from TD Ameritrade over the next five years, and the CFP Board’s goal to raise upwards of $10M in total funding over the next five years… for a Center that doesn’t even yet have any dedicated staff or clarity about its initiatives.
In other words, with little or no staff, and a mission that isn’t necessarily all that resource intensive (at least in its current form), why exactly is the CFP Board being so aggressive in raising substantial capital for the Center for Financial Planning? Is it possible that the CFP Board has a grander vision for the Center for Financial Planning… perhaps to expand into so many of the FPA’s membership association functions that eventually the CFP Board spins off the Center for Financial Planning into its own membership association?
Of course, the caveat to the CFP Board’s aspirations of membership is that the organization is ultimately a 501(c)(3) charity, and not a 501(c)(6) membership association, which limits its ability to directly deploy its assets and income to become a membership group. However, as also noted last year:
“While it’s not clear whether the organization could legally use its some of its own $23M war chest of net assets on its balance sheet to fund a new membership organization spin-off, it might use its relationships to leverage sponsors that could “seed” a new replacement membership organization, and then establish a tight integration between the CFP Board and the new association to rapidly accelerate its growth.”
In other words, raising $10M+ for the Center for Financial Planning doesn’t make very much sense when it has no staff and few clear programs and initiatives that would necessitate such funding. But it makes a lot of sense to seed the Center for Financial Planning with the kind of multi-million-dollar capital it would take to launch a competing membership association.
To put it in context, FPA’s own institutional sponsorship revenue across all sponsors is barely $1,000,000 per year according to its last audited financials, and the CFP Board may have just raised that much from TD Ameritrade alone. And the FPA’s total net assets are barely $3M, while the CFP Board’s Center is aiming to have triple that amount of seed capital within the next five years. The CFP Board is even soliciting ongoing individual donations, in what may easily be a precursor to ongoing membership dues?
Is An FPA And CFP Board Merger Inevitable?
Notably, while the CFP Board continues to entrench itself into what historically has been the FPA’s roles and responsibilities as a membership association, it’s unlikely that the CFP Board wants to see the FPA outright fail. The FPA’s chapter system in particular, and its growing capabilities to support a state advocacy effort, are a key asset in the ability of the CFP Board (directly or through the Financial Planning Coalition) to potentially support future standalone regulation for financial planning.
Nonetheless, as the FPA’s market share of CFP certificants continues to dwindle – and its average member age continues to grow older, even as the CFP Board’s average age is now turning younger – the FPA’s waning power, and its increasingly precarious financial position, may force the issue in the next recession. As is, the FPA’s revenue according to its last public financials remains down 36% from its peak in 2008, even as the CFP Board has grown significantly. Which means the CFP Board may simply need to continue to encroach into the FPA’s territory, and compete for its sponsor revenues by growing the Center for Financial Planning, and wait for a recession to create an organizational crisis that compels the FPA to merge for survival; as illustrated last year when the discussion of an FPA-CFP Board merger arose, CFP Board CEO Kevin Keller simply said "there are no current discussions about a merger between CFP board and FPA" (emphasis mine), distinctly leaving the door open to the possibility in the future.
Alternatively, if recession-driven financial woes don't drive the FPA to seek out a merger, the organization may also soon face a crisis driven by the Department of Labor’s fiduciary proposal. Ironically, while the FPA has advocated for the legislation through its Financial Planning Coalition efforts, if enacted the rule threatens to be highly disruptive to not only FPA members who are advisors at potentially impacted broker-dealers, but more significantly to FPA's sponsors that include broker-dealers themselves and the insurance and investment products that are distributed through broker-dealers. In other words, if the DoL fiduciary rule ends out significantly curtailing commissions, it could both impact FPA membership as some commission-based advisors leave the industry, and adversely impact FPA’s sponsorship revenue at conferences as those commission-based-product distribution companies would have little reason to exhibit at FPA conferences in a future with little or no advisor commissions. While these aren’t reasons for the FPA to back down from its profession-advancing fiduciary efforts, it’s not entirely clear that FPA has sufficiently diversified its sponsorship base enough to handle the coming industry disruption its lobbying efforts have helped to bring about.
Fortunately, though, the decline of the FPA doesn’t have to be a foregone conclusion. The CFP Board’s long history of mis-steps, both in recent years (e.g., the recent issues with definitions for compensation disclosure) and extending back for decades (e.g., the “CFP” debacle of the late 1990s), has long validated the FPA’s role in advocating on behalf of CFP professionals to push back on the CFP Board when it does something questionable. In fact, the FPA’s best path to survival at this point may be to explicitly capitalize on the collective nervousness of the CFP certificant community about what happens when the CFP Board goes “unchecked” for too long. And the FPA still has a small time window remaining to get its financial house in order, preparing for the necessary sponsorship restructuring that may be necessary in a post-DoL-fiduciary world. Though its biggest issue, by far, is simply figuring out how to turn around its 15-year decline in the market share of CFP certificants, as if there are “too many” CFP certificants without any membership association to serve them, it really does become inevitable that the CFP Board will fill the void.
Ultimately, it’s likely no coincidence that the CFP Board announced its Center for Financial Planning this week, just as the FPA’s own Board of Directors convenes its fall meeting, followed this weekend by its Chapter Leadership Conference. The announcement provides an opportunity for the CFP Board to gauge how much pushback there is to its new initiative, with enough ambiguity about its future initiatives to deny its competitive effort, before it decides how aggressively to roll out future FPA-competing programs from the Center for Financial Planning in the coming years. Which means the FPA has an immediate opportunity to aggressively defend its own turf, both to the CFP Board and more importantly to its own stakeholder community, and justify to the 73,000+ CFP professionals why they should continue to pay for both the CFP marks and a separate membership association to represent them. Otherwise, it may only be a matter of time before the CFP Board, and its Center for Financial Planning, fulfill both roles on behalf of the financial planning profession.
So what do you think? Is the CFP Board's new "Center for Financial Planning" just a research initiative, or do you think the $10M+ fundraising effort signals an intention for more? Should the FPA acquiesce to the initiative? If not, what should it do in response?
Michael,
As usual,an important and thought provoking commentary. I still have to wonder, though, if this doesn’t point to the dangers inherent in the FPAs Strategic Initiative of four years ago in which it tied itself too closely to the CFP Board. Had it remained a creature of the Financial Planning Profession rather than of the CFP Professional, it could still have continued to endorse the CFP Mark as the “Gold Standard” but only because and to the extent that it serves the profession.
Perhaps that distinction is too nuanced, but it seems that the FPA forfeited the ability to speak for the profession when it made itself the subservient entity. Indeed, a better course for the FPA might still be to focus on being the principal professional organization for financial planners. Indeed, by doing so, its endorsement of the CFP mark would be more meaningful since it would come from an independent professional organization. I realize, of course, that the FPA is independent, but it is hard to claim objectivity when you define yourself in terms of those who are credentialed by another entity.
Michael..to draw a parallel, CFA Institute seems to house everything under one roof – membership, certificate, journal, lobby and research. They have grown the best among all professional bodies. They have even expanded in a big way to Asia where we see huge increase in membership and certifications. I think CFA seems to have more clarity, focus, purpose and vision than FPA, CFP Board and other associations. You might know the workings of CFA better. But in my humble opinion housing all activities in one unit makes a lot of sense. And financially stronger too. What do you think?
David,
Frankly I see the issue as the opposite.
If the FPA moves away from the CFP marks, it guarantees its doom. Without the FPA staking ground as the leading membership association for CFP certificants, it leaves the door WIDE OPEN for the CFP Board to do it themselves. And if the CFP Board forms a membership association for CFP certificants in the FPA’s absence, I don’t realistically see the FPA winning that competition for membership. It would just cause the FPA’s demise.
Instead, the problem to me is that while the FPA internally declared its focus to be around the CFP Professional four years ago, it appears to have done so in name only. It has taken no public positions staking the CFP marks. It has been silent in the media about the CFP marks and the One Profession One Designation message. And despite being “focused on CFP professionals” ITS MARKET SHARE OF CFP CERTIFICANTS HAS CONTINUED TO SINK FOR FOUR YEARS.
Simply put, 73,000 CFP certificants is too large of a group to have a membership base. The FPA has two choices – step up and become that membership base (and grow its market share), or walk away from it and invite the CFP Board to be a full-on direct competitor with triple the resources and extensive access to the existing CFP stakeholder base. Given that crossroads, the FPA’s chances of survival are even worse by walking away from the CFP marks than by sticking with them.
The problem isn’t the FPA’s focus on the CFP marks. The problem is that it’s failing to attract CFP certificants despite that focus, and its unwililngness to stand up for CFP certificants at all (e.g,. the FPA was completely silent on the CFP Board’s reduction in the CFP experience requirement).
– Michael
Michael,
First let me say that that I am a huge believer in and supporter of the FPA, but I believe that by shifting its focus from the Financial Planning PROFESSION to the CFP PROFESSIONAL, the FPA sold itself short and relegated itself to being nothing more than the booster club for the CFP Board. As such, it rendered itself a subordinate organization in fact if not in legal structure and so forfeited control of its destiny.
While there may well always be a feisty bunch of CFP Professionals looking for an entity to represent them independently, the CFP Board will always be the primary organization since IT is the controlling entity. By definition, it will always have 100% of CFPs and FPA will always be limited to that feisty minority. The CFP Board will always want a subservient entity and will inevitably seek to squash any entity it deems insufficiently subservient.
An organization representing the Financial Planning Profession would have standing in its own right. It could and should support the CFP Mark, not because its mission statement says so, but because of what the CFP Mark stands for. That standing would not only enhance the legitimacy of the FPA, but world also make its endorsement of the CFP Mark far more meaningful. After all, how meaningful is the endorsement of the CFP Mark by an organization that defines itself as the organization of CFP Professionals?
More importantly, an organization representing the Financial Planning Profession would also be in a position to reach out, not only to affiliated professionals, but also to others in the profession such as those with the PFS designation without their being treated as alien entities, or worse, “enemies of the CFP Mark”. When advocating before governmental entities, it would also have the independent standing to speak for the profession. Finally, it would give the FPA the standing, if and when necessary, to stand up to the CFP Board.
You say that the problem is that the FPA has been silent in the media about the CFP marks and the One Profession One Designation, but how could any such media exposure have been anything more than an “us too” echo to the media campaign of the the CFP Board?
While technically, the CFP Board is not a membership organization, that is a nuance lost on all but a few of the CFP practitioners, and it is totally lost on the public and the governmental authorities. Yet it is on that very fine nuance that the FPA has come to rely on. Is it any wonder, then, that its existence has become increasingly precarious?
Michael, another great insight here that speaks for itself. I am familiar with some of TDAM’s strengths (active trading platforms incl sink or swim (a jewel!) and research having recently acquired Investools) but I think TDAM venturing into a fiduciary type work model supporting credentialed experts is somewhat of an identity crisis. (Grow or die I guess) Thanks for the work – SEE you and MANY others in Jan at AICPA/PFS Conf. Life is good. No needs.
In my view the merger of ICFP an IAFP was doomed from the start. The sales vs fiduciary cultures to not mix to say the least. FPA needs to plant its flag with the CFP’s. I have always wished my CFP was supported like the CFA and that the CFP Board was run similarly.
Bravo CFP Board.
Michael, as usual, thanks for your thoughtful leadership on a critical topic.
I have mixed feelings about the new Center.
As nascent academic nearly finished with the coursework for a PhD in financial planning, many of your observations resonate strongly with me, and I loudly applaud the emergence of a well-organized and -funded focal point for research and advancement of the discipline, literature, and hopefully of planners’ training and expertise standards beyond the basic CFP® credential, which as you have noted appears to have backslid a bit lately. For a field I believe to be as complicated as
medicine or law, this seems absolutely critical to the evolution toward a “real” profession. I believe the many other designations I’ve attained since the CFP® fundamentals training have been seminal in crystallizing whatever skill as a planner I have.
As a certificant with strong disagreements – some rising to a Federal lawsuit – with CFP® Board governance, marketing representations, training standards and licensee rights among them, I am deeply troubled by the proposed control of the “virtual entity” which would appear to rest wholly with the Board’s staff and directors, which is an “internally self perpetuating” ruling mechanism. As a CFA® Charterholder, I agree with Partha that the CFA® Institute is wonderfully functional, but note that it, as a 501(c)6 body (like all the AMA, ABA, and IACPA, I believe) is accountable to its members, and likely thrives due to healthy checks-and-balances. CFP® Board – as a charity licensing a trademark – is accountable only to the staff/directors mechanism. It is completely beyond member control, and, as my lawsuit against it has indicated so far, perhaps beyond judicial review as well. This totality of power – unlike any other profession of which I am aware – profoundly concerns me, to the point where for the first time since 1992 I am not sure if I will renew my certification this time.
Jeff Camarda, CFP®, ChFC®, CLU®, CFA®, CFS®, BCM™, E.A., MSFS®, doctoral student*
Maybe a merger with the condition that it converts to the legal status of a 501(c)6 is the best gift the GPA could give.
The advancement of the financial planning profession with the CERTIFIED FINANCIAL PLANNER™ certification as its cornerstone is a noble mission. And while FPA and CFP Board have made remarkable gains over the past 30 years, we still face challenges that must be overcome to realize our goal of being a truly recognized profession.
Currently, there are insufficient numbers of young CFP® professionals representing America’s gender and ethnic diversity to meet the public’s demand for the delivery of quality financial planning. The gap between supply and demand is just too great.
Over the past few years, CFP Board and FPA have developed a close strategic relationship as partners in the Financial Planning Coalition and through other endeavors. Through CFP Board’s new Center for Financial Planning and FPA’s ongoing national and local chapter efforts in areas such as its NexGen community, student chapters, Residency program, mentoring program, diversity initiative, and a variety of career development programs, CFP Board and FPA, along with other organizations and companies in the profession, will work to close the gap.
There are some who question the roles for CFP Board and FPA and whether we are working at cross-purposes or wasting valuable resources through duplicated efforts.
To us, our respective roles are as follows: CFP Board’s job is to “mint” planners, while FPA’s job, as the professional membership association for CFP® professionals, is to “nurture” them.
While the line between “minting” planners and “nurturing” planners is usually clear, there may be times when some of our initiatives overlap. Some overlap is not necessarily a bad thing, as long as we strive to ensure our efforts are complementary, because addressing the workforce development and diversity challenges facing the profession is bigger than any one organization can accomplish.
Our intention and commitment is to work together to leverage our strengths and maximize our resources to reduce confusion and overlap. We cannot afford to do otherwise. We are invested in each other’s success and we have plans in place to ensure that we work strategically to help one another achieve mutual goals.
Richard P. Rojeck, CFP®
Chair, Board of Directors
Certified Financial Planner Board of Standards, Inc.
Edward W. Gjertsen II, CFP®
2015 President
Financial Planning Association (FPA)
I am encouraged to read this response and see both signatures at the bottom! I would prefer to see a future where each organization leverages its strengths to continue to develop the future of the financial planning profession.
Michael
Was that a rhetorical question. You’ve got to know the answer is “yes”
The CFP Standards Board’s focused on the lowest common denominator is in conflict the FPAs aspiration to professional standing. Professional standards in advisory services essential for professional standing based on objective, non-negotiable fiduciary criteria of statute, case law and regulatory opinion letters have largely been ignored because it would not accommodate many established “planners.” Thus there is little basis in fact to support professional standing. The Financial Accounting Standards Board (FASB) is very definitive on what is required for professional standing (CPA). Essentially the Standards Board loose principles lets broker/dealers off the hook in supporting professional standing in advisory services. Yet SEC Commissioner Sara Stein is calling for TAMPs and ROBOs to authenticate fiduciary duty based on statute, case law and regulatory opinion letters. So, unless the Standards Board actually aligns with the statutory duties required of all those who render advice, it loses its relevancy. Professional standing in advisory services is going to happen without the Standards Board or the FPA. There is no advice lite. Advice for the mass market is often dismissed as entailing a lesser level of counsel even though ongoing fiduciary obligations incorporating all a client’s holdings and every recommendation ever made is required for professional standing. The fact that TDA is actively involved in a collaborative effort to innovate is important as advisors have no control over their b/ds and do not have the technical capability to individually innovate in scale. We are on the way to professional standing. Our largest RIA’s secret to growing assets, which is simply to demonstrably act in the client’s best interest in stark contrast to conventional brokerage, is about to be democratized for all who seek professional standing.
SCW
Stephen Winks