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CPD courses come under scrutiny

Advisers have been urged to “vote with their feet” if they don’t think continuing professional development (CPD) courses are up to scratch.

Tuesday, August 21st 2012, 6:25AM 8 Comments

by Niko Kloeten

New Code Committee chairman David Ireland said he’s aware of “mixed feedback” on the quality of CPD available in the New Zealand market, but he said advisers have the power as consumers to influence what is offered.  

“I think the market will hopefully dictate here and advisers will vote with their feet if they’re not happy with what’s on offer.

“There’s a market opportunity here; there’s some good stuff going on out there with providers trying to lift their game while others are looking for a commercial opportunity from it.”

Ireland said the Committee would look into whether there needed to be changes to the current regime, which lets advisers choose what to attend based on what they consider they need to do to maintain professional competence.

“It was deliberately made flexible to get advisers thinking like adults and making their own decisions… we don’t want to overly prescribe ways of doing it.”

Brent Sheather of Private Asset Management said many CPD courses in New Zealand are “counter-productive” as they are often run by “niche, high-cost providers” who encourage investment in risky, expensive and complicated products.

He cited recent US research that found most clients are better off in low-cost, diversified index funds.

“The more training a product needs the less likely it is going to be appropriate for your clients; the simpler the product the better.”

Sheather also questioned the relevance of some of the courses available.

“I recently saw a course advertised that was about how to drum up new business; I think it was called ‘how to network with high net worth individuals’.  While it might be useful to know I don’t see how it has anything to do with your competence as an adviser.”

Norman Stacey of Diversified said CPD is a good concept and much of what is on offer in New Zealand is quite useful, although there is “widely differing quality” between courses.

“Some of the product providers use it as a way of coercing attendance of their product pushes which is probably not a beneficial outcome.”

He said the other shortcoming of the current regime is the lack of recognition for attendance at overseas events.

“You might go to the FPA conference in the US, or the BCA New York conference or the Australian conference, all of which can be very valuable if not superior in broadening an AFA’s professional knowledge but they don’t fit within the current structure.”

Niko Kloeten can be contacted at niko@goodreturns.co.nz

« Minister surprised by lack of draw-down productsFund managers call for level playing field »

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Comments from our readers

On 22 August 2012 at 8:10 am Independent Observer said:
Perhaps the best solution here is for the Regulator to take over the dispensing of CPD credits to remove the obvious disparity in quality that exists.

It seems that the industry has failed yet again, when delegates can receive CPD credits when attending a course on “how to drum up business”
On 22 August 2012 at 4:17 pm w k said:
IO: how to award cpd credits when they don't even know what exactly they want.
On 22 August 2012 at 5:17 pm Alfred said:
The FAA makes no reference to "credits", only "structured hours".

Believe it not, I think advisers are keen to upskill and will pick workshops that are appropriate. Sounds like I am the only optimist - perhaps I am crazy to think that advisers can act as rational adults...
On 22 August 2012 at 10:23 pm traveller said:
This has been a problem as far back as I can remember, two decades or so.
On 23 August 2012 at 8:34 am Mark said:
The real problem is that some of the providers are incompetent. My colleague and I recently attended a course (on a subject that we had a combined experience of nearly 70 years and had tertiary qualification in) where we knew more than the presenter. The course notes were full of errors(close to 100 from memory. Thankfully the presenter accepted that we knew more than he did and we ended up running a good deal of the course. The exam perpetuated the errors. To pass we had to give answers, from the course notes, which we knew were wrong. One topic was on an Act of Parliament that had been revoked 18 years prior to the course!
ETITO really did not care.
On 23 August 2012 at 9:28 am Andy said:
I get a lot of valuable information that benefits my clients from outside sources - FINSIA, market reports and analysis. Training I get from internal (PAA/NZMBA, ETITO, etc) is useful to my own business, but not my clients. If we are to help our clients, we need to seek diversity. Unfortunately there are no CPT points in it for us, so we "fail" in our legal requirements.

Go figure!
On 23 August 2012 at 11:30 am Independent Observer said:
Whilst I'm sensitive to WK’s observations around the Regulator, there are too many examples of incompetent providers trying to make a buck out of CPDs.
Rather than this becoming the next slur against the industry, why don’t we just admit that we are unable to play by our own rules – and ask for an adult to preside over the CPD world.
On 23 August 2012 at 12:49 pm Mark said:
Andy is so right. A lot of the learning that adds value to my customer is "unstructured" in terms of the CPD regime. I wonder how much of the regime was designed by the education providers and yes, I do know the answer.

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