Advocis to ramp up regulatory education

Advisors often wait until it’s too late to express concern about new regulations in the financial services industry. Advocis is attempting to rectify that by adding a section on emerging regulatory issues to its best practices manual. The ERI will help advisors incorporate standards into their practice without having to wait until new regulations or legislation are introduced, Advocis announced Friday at its annual conference in Victoria.

“The new best practices manual will be an authoritative source on the most recent regulatory rules, initiatives and developments affecting the industry,” says Advocis incoming chair Roger McMillan. “It is important to provide financial advisors with an indication of the direction in which regulation is heading so they are in a position to plan ahead and increase their level of professionalism.”

There’s often a significant lag time from the time a regulatory initiative is contemplated and when it is adopted, Advocis notes. The ERI, which will cover regulation for the insurance, mutual fund and securities industries, will provide advisors with advance indications of the direction in which regulation is heading. This will allow them to provide input to the consultation process and plan ahead so they’re ready when the new regulations are up and running.

Though still a work in progress, Advocis has issued a preliminary list of emerging regulatory issues, including managing conflicts of interest, the impact of proposed do-not-call legislation on advisors, establishing personal corporations, reciprocal insurance licensing, the implementation of the fair dealing model, as well as anti-money laundering and privacy legislation.

“There are many examples of issues like this in the industry where regulators have said something but advisors and companies are not clear on how to apply them or what the core steps might be,” says Advocis president Steve Howard. “So we thought it was a natural role for our association to offer this to the industry while the requirements are hardening up.”

A recommended practice standard will be developed for each emerging issue, once Advocis believes that regulators are moving forward with a major principle, regulation or legislative amendment. Once the regulation is in place, it will become a permanent feature of the best practices manual.

Filed by Doug Watt, Advisor.ca, doug.watt@advisor.rogers.com