There are now more than 236,000 individuals around the world who hold the Certified Financial Planner (CFP) designation, and the Denver, Colorado-based Financial Planning Standards Board claims the number makes the mark more common than the Chartered Financial Analyst (CFA) title.
The Financial Planning Standards Board (FPSB) – which administers the CFP designation outside the US – aims to harness the intellectual and professional firepower of those CFP-holders and other, non-CFP, advisers for World Financial Planning Day on 7 October.
Now in its tenth iteration, World Financial Planning Day (WFPD) is designed to build global consumer awareness of financial planning and financial advice, and the role practitioners play in investor protection.
Its focus in recent years has been on helping consumers understand how they can protect themselves from fraud and scams, particularly online, as well as improving consumer education.
Chief executive of the FPSB, Dante De Gori, tells Professional Planner that the key message to consumers this year is to check with a trained professional, or to get a second opinion, before they act.
WFPD falls in the middle of World Investor Week, coordinated by the International Organization of Securities Commissions (IOSCO), of which the Australian Securities and Investments Commission (ASIC) is a member, and Financial Planning Week, backed by the Financial Advice Association Australia (FAAA).
‘No one really understood’
Over the course of a decade, the day focusing on the role of advisers has grown from “this new thing that no one really understood”, De Gori says.
“The day specifically is about introducing the concept of financial planning and how that potentially could support investor protection, investor education,” he says.
“The main evolution has just been a greater alignment in terms of trying to support IOSCO’s objective, which is most in recent times frauds, scams, trying to help investors to be more aware about what they’re doing online and how financial planners can be, if you like, the first line of defence.
“But of course, not everyone has a financial planner, therefore that’s harder. But to the extent that they exist, we are pushing and saying, well, at least the financial planner can help… before you do something. You might get presented this opportunity that you think is great, you should validate or just check with the trained professional before you take action.”
FPSB is the central organising body for WFPD-related events that will take place in 22 territories.
“We put together all the assets effectively, and we allow all the territories to use them and localise them,” De Gori says. This year’s cornerstone is research on artificial intelligence and financial planning, based on responses from 8000 planners in 24 countries to this day
The FPSB will release the global report, and it is up to individual associations, including the FAAA, to release localised insights. Professional Planner understands that the research suggests Australian financial advisers lead the world when it comes to the use of AI.
Australia was the first country outside the US to adopt the CFP mark, when it was introduced by the International Association for Financial Planning (IAFP), then under the leadership of the late Gwen Fletcher.
It carried over after the IAFP merged with the Australian Society of Investment and Financial Advisers (ASIFA) to form the Financial Planning Association (FPA) in 1992, and continues to this day under the FAAA.
He says CFP course materials are expressly tailored to local rules and regulations in each of the territories it’s available.
“CFA is a US education program, and so it doesn’t matter where in the world, it’s the same program. CFP certification is localised both in terms of language and content. If you’re in Australia, you’ll learn about superannuation and tax system and Australian legislation.
“It’s also done in the [local] language. If you take it in Japan, you take it in Japanese.
“It’s not just they pick up a model, and everybody has to do it. You are meant to be able to walk out and give advice to a retail client.”
Chicago, 1969
The CFP designation was introduced in Chicago in 1969, and the College for Financial Planning in Denver, Colorado (where the FPSB remains based today) ran the first course about two years later.
“There was a class of 42, and they were the first individuals to attain the Certified Financial Planner designation,” De Gori says.
“Australia was the first country in which the CFP certification was brought outside the US. Japan followed, Canada followed, and then eventually the US organisation and other interested countries [decided] this is obviously a growing thing, and so they decided to create an organisation specifically for the purposes of running and supporting the CFP certification internationally.”
The FPSB was established in 2004 and continues to expand its reach as more global financial services industries develop to the point that financial advice and financial planning become valued services.
“The most recent territory is Italy that we’ve brought on, and we’re in conversation with a few others,” De Gori says.
“We get interest from many markets, especially across Southeast Asia – Philippines, Vietnam, we’re in strong discussions in Vietnam, as an example – and the Middle East is a strong area where we get inquiries to bring it there, [and] a lot of North African countries. We are piloting in Colombia at the moment, so Latin America is a focus for us as well. There are a number of markets, but it takes a while.”
Typical path
De Gori says the typical path to introducing the CFP in a territory is to partner with “an established professional body that is responsible for financial advice or financial planning in their territory, and they can bring this in”.
“But we are now entering, or we have seen, markets where they don’t have an established framework like that. We actually get interest from regulators saying, look, our market at the moment is very much people selling products, we don’t have much [advice] regulation, or there’s no standards that we have in place.
“There’s an opportunity to bring in at least the framework of CFP certification, which is the four Es of education, examination, experience and ethics, and provide a structure, a framework, which then we can build on and bring the certification.
“Most of the mature markets have the certification, but there’s obviously a lot of markets [wanting to] create a financial planning profession. So, there’s a lot of conversation in respect to bringing the certification in the market.”
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