Har­ness the power of pro­fes­sions

Investment Executive - - COMMENT & INSIGHT - BY PATRI CIA C H IS H O LM IE

there’s a news story that never seems to go away, and it’s the con­tin­u­ing dif­fi­cul­ties faced by work­ers in their 20s and 30s who are try­ing to gain a se­cure foothold in the work­place.

There’s a plen­i­tude of part-time and con­tract po­si­tions, but a shrink­ing num­ber of fairly paid, per­ma­nent po­si­tions with ben­e­fits and a rea­son­able de­gree of job se­cu­rity. Ac­cord­ing to 2015 re­search, 52% of work­ers in the bur­geon­ing Golden Horse­shoe area of On­tario rely on pre­car­i­ous work.

If you want to be an ar­chi­tect, ac­tor, jour­nal­ist or full-time pro­fes­sor, be pre­pared for dis­ap­point­ment. On the other hand, thou­sands of po­si­tions in many re­ward­ing jobs go beg­ging, year af­ter year. They range from sup­ply-chain man­age­ment (va­can­cies are in the 27,000 range) to forestry to skilled, non-pro­fes­sional po­si­tions in fields such as health care and law.

Add to that list fi­nan­cial plan­ning and fi­nan­cial ad­vice, in­clud­ing in the in­surance in­dus­try. As has of­ten been re­ported in these pages, many fi­nan­cial ser­vices firms and in­de­pen­dent ad­vi­sors are strug­gling to re­cruit younger ad­vi­sors to join a firm, learn the busi­ness and plan on a long-term ca­reer.

As a re­sult, the av­er­age age of ad­vi­sors is ris­ing rapidly. Ac­cord­ing to re­search ob­tained from In­vest­ment Ex­ec­u­tive’s Re­port Card se­ries, 43.5% of ad­vi­sors are now be­tween the ages of 51 and 64. That fig­ure was 31.9% in 2008. Even more sober­ing, only 9.6% of ad­vi­sors are now un­der the age of 35.

What gives? Are re­cent grad­u­ates un­aware that a ca­reer as an ad­vi­sor of­fers many op­tions, from work­ing as a fee-based fi­nan­cial plan­ner, to guid­ing port­fo­lio struc­tures to help­ing clients make key in­surance choices? Not to men­tion com­pen­sa­tion that is gen­er­ally in the six fig­ures and enor­mous po­ten­tial for ad­vance­ment.

There’s lit­tle doubt that the in­dus­try could in­vest more time and money in re­cruit­ing rook­ies, per­haps by spend­ing more time in high schools and on col­lege and uni­ver­sity cam­puses. But a key ini­tia­tive that gets lit­tle at­ten­tion in this re­gard and that would go a long way to­ward boost­ing the pro­file, cred­i­bil­ity and re­spect ac­corded this in­dus­try would be to move to­ward a pro­fes­sional stan­dard for fi­nan­cial ad­vi­sors.

An ex­pert com­mit­tee com­mis­sioned in On­tario to study the is­sue re­cently rec­om­mended that such a stan­dard should be adopted, partly by set­ting uni­form des­ig­na­tions that re­quire post-sec­ondary ed­u­ca­tion. The Fi­nan­cial Ad­vi­sors As­so­ci­a­tion of Canada (Ad­vo­cis) and the Fi­nan­cial Plan­ning Stan­dards Coun­cil have long ad­vo­cated for these types of re­forms.

Such a change would also help meet the ar­gu­ments be­ing made by On­tario reg­u­la­tors for the adop­tion of a fidu­ciary stan­dard for ad­vi­sors in On­tario. Given that pro­fes­sion­als such as lawyers and cer­ti­fied ac­coun­tants must meet such a stan­dard as part of their pro­fes­sional qual­i­fi­ca­tions, why not ex­tend it to ad­vi­sors?

Uni­form, tested stan­dards, backed by rig­or­ous aca­demic cre­den­tials and a vig­i­lant su­per­vi­sory body, such as those that govern other pro­fes­sion­als, could re­sult in many pos­i­tive changes— not least of these is re­newed in­ter­est in this in­dus­try by the bright­est and best young grad­u­ates.

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