{"id":4375,"date":"2024-08-06T13:42:23","date_gmt":"2024-08-06T20:42:23","guid":{"rendered":"https:\/\/www.iafp.ca\/planners\/?p=4375"},"modified":"2024-08-06T13:48:39","modified_gmt":"2024-08-06T20:48:39","slug":"why-the-iafp-is-adopting-a-fiduciary-standard-for-financial-planners","status":"publish","type":"post","link":"https:\/\/www.iafp.ca\/planners\/articles\/2024\/08\/06\/why-the-iafp-is-adopting-a-fiduciary-standard-for-financial-planners\/","title":{"rendered":"Why the IAFP is adopting a fiduciary standard for financial planners"},"content":{"rendered":"\t\t
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The IAFP sees a growing appetite for fiduciary values, which could also help to recruit new members.\n<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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The Institute of Advanced Financial Planners (IAFP) intends to introduce a new fiduciary standard for its members, effective when they renew their memberships in 2026.<\/p>\n

In a letter to members last week, the organization stated its intention to become the first financial planning credentialing body in Canada to introduce a fiduciary standard. The move will assure clients that financial planners who hold the registered financial planner (RFP) designation provide advice \u201cbased on what\u2019s truly best\u201d for the client and free from self-interest, the letter stated.<\/p>\n

Aaron Hector, the IAFP\u2019s vice-president and symposium chair in Calgary, says the standard will elevate the professionalism of financial planning in Canada, and could attract more interest in membership.<\/p>\n

He recently spoke with Globe Advisor.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Why is the IAFP introducing a fiduciary standard now?\n<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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A fiduciary standard has been discussed at the board level for years but it never quite seems like the right time. The fear was too many members would not be willing to raise their hand and hold themselves out publicly as a fiduciary.<\/p>\n

But in the last few years, we have seen many positive developments. When we look at other organizations, the CFP Board in the U.S. changed some of its code of conduct to reflect fiduciaries. The Financial Planning Association of Canada also has a fiduciary pledge. So, we see a growing appetite and willingness to state fiduciary values publicly.<\/p>\n

The values are holding your client\u2019s best interest over your own. You have a duty of fidelity, honesty and complete disclosure to your clients. You can\u2019t act with self-interest.<\/p>\n

While this announcement is the board\u2019s intent, we are going to have some focus groups and also discuss at our annual general meeting. But so far, the initial reaction has been overwhelmingly positive.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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What does the process toward adoption look like?<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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We\u2019ll have to make some changes to our code of ethics and make it part of our renewal each year, that RFPs are willing to hold themselves out as fiduciaries. We have our vision and direction but details still need to come into place. For example, how are we going to discipline if we hear of someone who\u2019s not holding themselves up to the standard that they attested to? We\u2019re going to need to ensure that our disciplinary framework deals with that. We have a year to finalize those details.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Do you foresee any challenges?<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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There could be current RFPs who would not feel comfortable being so vocal about holding themselves to a fiduciary standard. I expect those situations will be minimal. Even if there is some attrition, it could be quite good for membership growth over the long term. There are many high-quality, ethical financial planners who would look for a designation where they have to attest that they are holding themselves as fiduciaries.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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This article was originally published in the Globe & Mail, Globe Advisor weekly newsletter for professional advisors. Written by Deanne Gage, Globe Advisor reporter, August 2, 2024.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

The IAFP sees a growing appetite for fiduciary values, which could also help to recruit new members.<\/p>\n","protected":false},"author":1,"featured_media":4376,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[22],"tags":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/posts\/4375"}],"collection":[{"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/comments?post=4375"}],"version-history":[{"count":8,"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/posts\/4375\/revisions"}],"predecessor-version":[{"id":4384,"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/posts\/4375\/revisions\/4384"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/media\/4376"}],"wp:attachment":[{"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/media?parent=4375"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/categories?post=4375"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.iafp.ca\/planners\/wp-json\/wp\/v2\/tags?post=4375"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}