Financial Planning / Wealth Management

Striving for excellence in financial planning

by Bernard Wan

Henry Lam, President, Institute of Financial Planners of Hong Kong

The Institute of Financial Planners of Hong Kong is committed to fostering professional standards for practitioners in the areas of competency and ethical practice, writes Bernard Wan

The Institute of Financial Planners of Hong Kong (IFPHK) was founded in 2000 by obtaining the backing of 30 corporate members representing major financial services companies in banking, insurance and asset management. With the support of these founding members, it developed into a professional self-regulatory organization within two years. Now it boasts 1,500 members, 330 of whom are Certified Financial Planner (CFP) licensees registered with the Institute as ordinary members who bear full ethical responsibilities towards the public, clients and employers.

The fourteenth affiliate member of the International CFP Council, the Institute is authorized by the CFP Board in the US to be the sole licensing authority for administering the CFP certification process in Hong Kong.

Customers first

"The whole concept of financial planning is based on the idea of "customers first" - understand your customers' needs by seeking out what they need through analysis and assessment and help them make informed decisions," Henry Lam, President of the IFPHK, explains about the fundamental responsibilities of a professional financial planner. To become a CFP licensee, a candidate must have fulfilled the certification requirements known as the 4E qualifying procedure - Education, Examination, Experience and Ethical Conduct Compliance.

To meet the education requirements, a candidate can enroll in a six-module course with any of the three local universities designated by the Institute. "We pulled in local and overseas academic experts to develop the courses with us. Our primary role is to monitor the competency level of the candidates enrolled in the courses and uphold the quality of the courses delivered by the universities," emphasizes Mr Lam. "With the CFP qualifications gaining increasing momentum in Hong Kong, we expect to see more education providers offering more course options in the near future and wider recognition of the CFP certification from the public and professional bodies."

Professional quality assurance

Twice the Institute has administered the certification exam, which is based on the US model. Approximately 160 candidates took the exam in 2001 and 1050 in 2002, with pass rates of 33 per cent and 23 per cent respectively. Mr Lam explains that although the pass rate of the exam is not comparable with an average of 50 to 60 per cent in the US, their CFP program has been in existence for much longer and supporting materials for the exam are probably more readily available.

Mr Lam admits that he was pleasantly surprised by the large number of candidates sitting for the June exam. He expects to see more candidates registering in December, as the Institute allows degree holders with three years' relevant work experience to enter the exam for the last time with the exemption of the stipulated education requirements. He says: "After this year, only candidates with professional qualifications recognized by the IFPHK, such as certified public accountants (CPAs) and lawyers, will be entitled to sit for the 10-hour integrated certification examination that spans over two whole days without going through the formal education requirements."

International endeavors

The IFPHK closely collaborates with the other 16 licensing institutes governed by the International CFP Council. Currently, there are about 70,000 CFP practitioners worldwide. "Representatives from the 17 licensing institutes meet twice a year to determine global strategy, share information on financial planning developments and learn new ideas," says Mr Lam. The IFPHK is on a mission to make reciprocal arrangements with all affiliate CPF licensing institutes across the world for the conversion of the CPF certification marks issued by individual licensing institutes.

In line with its founding objectives, the IFPHK will focus on recruiting members and promoting the profession of financial planning to the public and practitioners in the financial service industry through a series of marketing activities and large-scale seminars. "Continuing professional education will be another direction of future development. At present our associate members and CFP licensees need to undergo 10 and 15 hours of continuing education per year respectively to maintain their licenses. Right now we're planning to introduce more continuing professional education courses to comply with this prevailing trend," emphasizes Mr Lam.

New directions

The IFPHK has a significant international presence. "We represent Hong Kong in an international technical committee established to define and enforce global ISO standards in financial planning; through the participation we hope to understand the trends of international development and see how Hong Kong can accommodate the development, " says Mr Lam. The IFPHK has also joined a task force set up by the CFP Board to offer advice on introducing and promoting financial planning on the Mainland. "We feel that it is our obligation to help accelerate the pace of the profession's development on the Mainland. We also hope to give direction to Hong Kong practitioners when they look for opportunities in China."

Lam is optimistic about the future of the profession in Hong Kong. "When the market is mature with more financial products available, CFP practitioners will become fully recognized for their professional prestige and credibility, like doctors and lawyers." He foresees that some years from now, consultancy firms run by independent financial planners will emerge in Hong Kong, offering professional financial consultation and services similar to their counterparts in the US and Australia.

For further details about the CFP certification, please refer to the Institute of Financial Planners of Hong Kong website at

Taken from Career Times 13 September 2002
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