Who Shall Rule the Planning Profession? Competition versus Consolidation
If there’s one topic that is guaranteed to stir up passions in the financial planning/advisory profession it’s consolidation of associations and credentials. Consider some of the issues that are being debated today.
Many professionals (including me) are still having trouble getting over the merger in 2000 between the IAFP and the ICFP that produced the Financial Planning Association (FPA). They argue that the new consolidated organization watered down the ICFP’s core mission of supporting the CFP designation and professionalism in the marketplace, by accepting sponsors in the local chapter meetings, and by including advisors who are clearly not fiduciaries into the association ranks. Some chapters are largely made up of dually-registered advisors who wear “two hats” when they engage clients, along with life insurance agents who sell for a living. Many members don’t hold the CFP designation and a significant number are not financial planners at all. The result, they say, is a weaker sum of the parts.
This may explain why, despite the growth of the profession and the expanding ranks of the CFP-holders, the FPA has fewer members today than the two organizations had at the time the merger occurred.
Leaders of the FPA, meanwhile, have adopted the slogan “one profession, one designation” – and have argued that everybody in the profession should jump on the same ship, so that one association would have the power to speak on behalf of the entire profession. Think of the things they could do with a membership that included everybody who called themselves a financial planner or advisor!
Of course, that argument was made at the time of the ICFP/IAFP merger, when there were big visions about how the FPA could become the nerve center of the profession through robust online discussion forums, a strong professional magazine and a book publishing division that would bring together the profession’s thought leaders.