Advocis Conference Update: Undesignated advisors now welcome

(May 13, 2005) Canada’s largest advisor association has a problem. It’s not large enough. As announced Thursday at the association’s annual conference taking place in Halifax, Advocis is essentially reversing its strategy of restricting its membership base to designation-holding advisors — specifically those who hold either the CLU or CFP.

Incoming vice-chair Roger McMillan says the change acknowledges a simple fact of the industry. “There are some people out there today that are undesignated but are extremely competent. The whole designation thing has passed them by. They just feel that they know what they’re doing, and they do.”

McMillan says Advocis has, in the past, worked to bring these advisors into the association by steering them toward attaining an approved designation. But a new class of membership will mean they can join Advocis with no designation requirement.

Advocis president Steve Howard says, going back a few years, the association’s board believed the focus should be on designated advisors to help consumers distinguish who was a professional in the area of advice beyond the transaction. “We realize now that’s a subset in the industry because there are also insurance advisors and investment advisors who focus just on the transaction. They are professionals too.”

Howard says these transaction-oriented advisors, who chose to join Advocis, would still be subject to the association’s code of conduct and the other standards of practice. “There’s room for the two types of individuals in the industry,” he added.

However, Howard says there would still be a significant distinction between the designation-bearing members and those who don’t have an approved designation. “In holding themselves out as members of this association, [non-designated advisors] can’t use the association as a professional badge. The badge is still in the designations. So if you are in the future a member of Advocis, you have to identify if you are a designated or undesignated member.”

A public awareness campaign currently underway includes broadcast commercials that tell consumers looking for professional financial advice to look for the Advocis brand. But with two classes of Advocis members, the potential for confusing or even misleading consumers arises. Howard says the current ads were done on a trial basis and in any new public awareness campaign, “the consumer will further know that those who can hold out as a financial advisor are only those who are designated to do so.”

Howard is also renewing appeals to other advisor associations to consider joining forces. While Advocis has lost membership over the past several years, it still is the largest association with about 13,000 members. The combined membership of the Canadian Institute of Financial Planners and the Independent Life Brokers is about 5,000. “The CIFPs is doing a good job and so is IFB. I applaud those organizations and I respect the people that are working there,” Howard said. “I just wish we could work together.”

Howard says Advocis recognizes each organization has its strengths. “Our roots, frankly, are in insurance and we do that very well. And if the CIFPs would come and talk to us on a cooperative basis and they said, ‘we want to look after the financial planning side of this,’ it would be a natural fit. And if IFB said, ‘we’d want to come in to this and we want to take an aspect,’ my door would be open and our board’s door would be open.”

Howard and McMillan’s comments came during a press briefing Friday morning at the Halifax conference.

Filed by Darin Diehl, Advisor.ca, darin.diehl@advisor.rogers.com