Approved Associate Consultant Training

How to implement ‘Best Practice’

Agenda

• An introduction to ISO 22222• Benefits

• Financial Planner, Consumer, Consultants• Introduction to BS 9222Introduction to BS 9222• The Approved Associate Consultants Programme• The Certification ProcessThe Certification Process• How to implement the six steps of financial

planningp g

Agenda

• Risk Management• Information Security, IT Security, y, y,

Business Continuity, Compliance• Ethics• Continual Professional Development• Retail Distribution Review• How to document your Practice Management

System • Implementation planning

What are ISO Standards?

• ISO standards – more common to the business market• ISO – International Standards Organisation

Demonstrates the ability to consistently provide a product or service that meets customer requirements in line with regulatory requirements andin line with regulatory requirements, and…Addresses customer satisfaction through the effective application of the system, developing processes for pp y , p g pcontinual improvement and the prevention of errors and mistakes.

Why have National and International Standards?

• The CE Mark • The Kitemark

Identify and meet the needs and expectations of its

• They help businesses to:

Identify and meet the needs and expectations of its customers and other interested parties, i.e. employees, suppliers, owners, societies, to achieve a competitive advantage and to do this in an effective and efficient manner.Achieve maintain and improve overall performance and Achieve, maintain and improve overall performance and capabilities.

Why have an ISO Standard for Financial Planners?

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ISO 22222 – An Insight

• Enables consumers to identify financial planners who possess the right knowledge, skills, ethics and experience to deliver their desired level of service.

• Codifies best practice in financial planning from th ld d lt ill h l t across the world and, as a result, will help to

increase consumer confidence.

ISO 22222 – The Six Steps

1. Establishing and defining the client and personal financial planner relationship

2. Gathering client data and determining goals and expectationsA l i g d l ti g th li t’ fi i l t t3. Analysing and evaluating the client’s financial status

4. Developing and presenting the financial plan5 Implementing the financial planning 5. Implementing the financial planning

recommendations6. Monitoring the financial plan and the financial g p

planning relationship

Financial Planner Benefits

• Improved performance• Simplified and effective processes and documentation• Standardisation of good working practices• Improved communication (internally/externally)

Promotes awareness of quality and professionalism • Promotes awareness of quality and professionalism, better public awareness and public image

• Improved sales and marketing opportunities• The acquisition of a symbol representing the

internationally recognised quality standard ISO 22222Reduced risk = potential reduced insurance costs• Reduced risk = potential reduced insurance costs

• Improved compliance - supports regulatory requirements

Consumer Benefits

• Adds value to services provided by the Financial Planner

• Assurance of quality of service• Commitment to continual improvement and

li th gh i d d t thi d t compliance through independent third-party accreditation

• Increases perception of the Financial Planner’s profile, • Increases perception of the Financial Planner s profile, and company’s culture and image

• Enhances business relationships - building trust, securing repeat business

• Reassurance that regulatory requirements are being adhered to and monitoredadhered to and monitored

BS 9222:2007

• BS 9222:2007 Personal financial planning guidance on the application of BS ISO 22222 and assessment of

lcompliance

• Provides UK-specific information on the application of th t d dthe standard

• Information to tailor the use of the standard to the requirements of the UK financial environmentrequirements of the UK financial environment

The Certification Process

What does ISO 22222 mean for What does ISO 22222 mean for Compliance Consultants?

• Knowledge of International ‘Best practice’ Standard.

• Global service offering• Financial benefits• Independent assessment• Demonstrate credibility and confidencey• Attract new business• Adds value to your services – retain clientsy• Latest updates on ‘Best Practice’

Approved Associate Consultant Approved Associate Consultant (AAC) Programme

• AAC Process

• Code of ethics

• Benefits• Benefits

• AAC Register

How to implement the Six Steps

1. Establishing and defining the client and personal financial planner relationship

2. Gathering client data & determining goals and expectationsA l i g d l ti g th li t’ fi i l t t3. Analysing and evaluating the client’s financial status

4. Developing and presenting the financial plan5 Implementing the financial planning 5. Implementing the financial planning

recommendations 6. Monitoring the financial plan and the financial g p

planning relationship

Risk Management

• Which areas of ISO 22222 are associated with Risk Management?

Information Security

• Information is an asset – protect it!• CIA

• Confidentiality• Integrity• Availability

• Identify threats – internal, external, accidental and malicious

• Implement controls – policies, procedures, software and hardware functions

Implementing Information Security

• Identify threats and weaknesses• Review security – building, personnel, ITy g, p ,• Review contracts – clients, suppliers• Establish who has access to your dataEstablish who has access to your data• Mobile media – Blackberrys, USB sticks• Encryption devices• Encryption devices• Gap Analysis against FSA’s Data

Security Recommendations/ yISO 27001

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Business Continuity

• Business Continuity Management

Holistic management process that identifies Holistic management process that identifies potential threats to an organisation and the impacts to business operations that those threats, impacts to business operations that those threats, if realised, might cause and which provides a framework for building organisational resilience with the capability for an effective response that safeguards the interests of key stakeholders, reputation brand and value added activitiesreputation, brand and value-added activities.Definition: BS25999-1:2006

Implementing BCM

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Implementing BCM

• Identify your key services, the critical activities and resources that support them

• This involves the following steps:• Business Impact Analysis (BIA)• Identification of critical activities• Determination of continuity requirements

E l ti f th t t iti l ti iti• Evaluation of threats to critical activities• Undertaking of a risk assessment• Determination of measures to treat or mitigate • Determination of measures to treat or mitigate

these risks

Compliance

• Which areas of the standard are associated with compliance?

• How does this correlate with what you currently y ydo?

Ethics

“ISO 22222 requires a high level of knowledge and competency and factors in TCF through compliance issues and expects very high ethical standards. It is the only such requirement for financial planners/ advisers to explicitly ask clients if they would like advisers to explicitly ask clients if they would like to invest taking into account socially responsible,

ethical or religious ”

Source: Robin KeyteSource: Robin Keyte,Chartered and Certified Financial Adviser,(Financial Adviser 8th May 2008)

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The Ten Key Ethical Principles

• Behaving with integrity• Putting clients’ interests first• Exercising due care and diligence• Working within regulatory and legislative frameworks• Carefully and comprehensively managing conflicts of

interest• Communicating in a clear and appropriate manner• Communicating in a clear and appropriate manner• Providing suitable and objective recommendations• Protecting client confidentialityg y• Making all material disclosures• Demonstrating and maintaining

appropriate competence

Continual Improvement

• P D C A – Plan, Do, Check and Act

• Client feedback – positive and negative

• C P D – Embed professionalism

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Deming’s Cycle of Continual Improvement

Continual Improvement

CPD

• Have a plan and set objectives• Adviser and team• Internal support and development• Technical and Best PracticeTechnical and Best Practice• Technical Communications Plan• De-brief meetings and reviewDe brief meetings and review• Technical library

Amanda Bowe - Retail Distribution Financial Amanda Bowe Retail Distribution Financial Services Summit – 4th September 2007

“We set out some different suggestions for debate on what "highly qualified" might mean – and these were deliberately different because we want your views on what standards should apply. The because we want your views on what standards should apply. The paper makes it clear that we are talking about higher professional standards here, not just higher qualifications. For example, we have focused on chartered or certified because they are the standards f f yfamiliar to many in the market. It might be that the ISO 22222 could provide an alternative or even complementary standard. We want to see the right balance between the qualifications required to g q qdo the job, and the experience and knowledge gained whilst doing it. We are not just interested in examinations. We are interested in a range of things that constitute professionalism including ethics, competence, experience, and so on. Identifying how best to achieve this balance is one area where the industry could usefully take the lead”.

Quotes from the RDR

• “We want standards of professionalism that inspire consumer confidence”

• “Being a professional financial planner is g p psomething to which all would aspire”

• “The Professionalism and Reputation Group recognised the importance of ethical and b h i l t d d ”behavioural standards”

How to document a How to document a Practice Management System

• Introduction• The Company ie profile, scope of services, insurance,

b member associations• Mission Statement, Company policies• Code of ethics - TCFCode of ethics TCF• Company Objectives • Business Review Process

O ti l P d 6 St• Operational Procedures – 6 Steps• HR/CPD – tools, methodology, process, review• Risk Management Procedures g• Control of documents and records• Purchasing/Accounts

Continual Improvement• Continual Improvement

Implementation Planning

• Identify existing policies, processes and documents and records

• Gap Analysis ISO 22222/BS 9222/FSA requirements• Establish recommendations• Establish resources, methodology and timeframe• Document a holistic Practice Management System

R i ith li t d fi l d ft• Review with client and approve final draft• Communicate and embed within practice

Conduct internal audit to demonstrate • Conduct internal audit to demonstrate compliance prior to assessment

• Confirm assessment

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Any Questions..?

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