Executive Summary
As discussion and debate rages on regarding the CFP Board's proposed 80% fee increase, and the associated public awareness campaign it is intended to support, much of the underlying concern seems to boil down to a simple issue: Is the CFP Board "our" champion? Should it be? Can it be?
Late yesterday CFP Board managing director for public policy and communications Marilyn Mohrman-Gillis publicly responded in an interview with Matt Ackerman at Financial Planning magazine to a number of the concerns posted in a discussion board thread regarding the CFP Board's proposed 80% fee increase as announced at the FPA Annual Conference this past weekend. Notwithstanding her attempt to address the issues posed, the general negativity of feedback on the Financial Planning message boards in response to Mohrman-Gillis' interview continues at an active pace.
In reading through the responses, I was struck by the level of negativity and distrust towards the CFP Board, which seems to emanate from a belief that the CFP Board should be championing "us" - the CFP practitioners - and the financial planning profession, but instead is only about itself. Why can't the CFP Board listen to its certificants, many ask? Why can't it represent us more effectively, like the AICPA or ABA do for their accountant and lawyer members, respectively?
The answer stems from the fact that, unlike the AICPA and the ABA (not to mention our own FPA and NAPFA organizations), the CFP Board is not a 501(c)(6) membership association; it was actually organized and is classified as a 501(c)(3) public non-profit. In other words, the CFP Board can't represent us as members, because... well, it's not actually a membership organization!
The actual mission statement of the CFP Board, consistent with its tax and legal classification as a 501(c)(3) organization, is "to benefit the public by granting the CFP certification and upholding it as the recognized standard of excellence for personal financial planning" (as extracted from the CFP Board's publication on the Purpose of the CFP Board). In accordance, the CFP Board seeks to achieve its mission through six core objectives:
1) Credentialing: Provide the most rigorous financial planning credentialing process that is valid, reliable and legally defensible.
2) Education: Establish and enforce educational standards for enhancing the knowledge, skills and abilities of current and potential CFP certificants.
3) Enforcement: Protect the public’s interest through rigorous, ongoing enforcement of CFP Board’s Standards of Professional Conduct.
4) Communication: Build the CFP certification brand as the recognized standard of excellence in financial planning; Promote its understanding and acceptance among the public and other stakeholders.
5) Advocacy: Influence policy to benefit the public and increase access for all to competent and ethical financial planning.
6) Sustainability: Strengthen CFP Board’s capacity to achieve its mission and serve all stakeholders in a timely, accurate and professional manner.
Accordingly, I have to admit that I'd be more concerned if the CFP Board's board of directors did not pursue initiatives like this; the planning community may not like the mismatch between "our" goals and the CFP Board's "mission", but the board of directors ultimately has a responsibility to help the organization achieve its goals or it is failing in its role as a board.
Of course, this is not to say the CFP Board functions exclusively in a self-serving environment. The long-term health of the financial planning profession and its practitioners are still in the interests of the CFP Board. In point of fact, I think the organization is well aware of this; it's why the CFP Board has relented on some of its initiatives in the past (including the whole infamous "CFP Lite" affair), and is why - as Ms. Mohrman-Gillis points out in the Financial Planning interview - the CFP Board took significant steps to understand the views of CFP practitioners before announcing the planned initiative. In addition, it is also notable - as I pointed out in a prior Nerd's Eye View blog post - that the CFP Board has also made the effort to announce this change, before it takes effect, allowing the planner community the opportunity to raise some of the justifiable concerns it has expressed. I don't know if the objections and concerns of the planner community will derail this initiative, but I do hope and expect that the board of directors will be cognizant of the concerns when it comes to the details of the final proposal they will vote upon next month.
Nonetheless, it seems that once again the planning community sits at a crossroads with the CFP Board. Once again, the planning community wishes for the CFP Board to be its champion to represent the interests of CFP certificants "as members" and the financial planning profession at large. But the CFP Board is not really our champion, nor can it be in its current form. Thus, instead, the CFP Board proceeds down its 501(c)(3) public interest path, and we all hope that "our" goals and "their" goals align closely enough to achieve mutual success.
Is the CFP Board's path this time around deviating far enough from the planning community that it will vote with its money (and drop the designation), or attempt to establish an alternative organization that will have a mission "focused on the profession"? The CFP Board doesn't seem to think so. I guess time will tell whether the CFP Board's research and survey efforts to the planning community were on the mark or not.
What do you think? Is the CFP Board our champion? Should it be? Can it be?
Many planners report that the primary reason their clients choose to work with them is a foundation of trust built with that individual client, which subsequently blossoms forth into a bona fide planner-client relationship. Accordingly, many planners have…