Self-regulation on the cards: FAAA

The financial advice industry has finally earned "profession" status and has the potential to self-regulate in the near future, according to Financial Advice Association Australia (FAAA) chair David Sharpe.

In six years' time, Sharp believes the advice profession will at least be co-regulated, lauding advisers' collective commitment to be in the same leagues as other established professions.

"We've been too beholden to those outside of our profession to determine our fate, to determine our standards, and we believe that we are now ready and most qualified to take control of education and training, code of ethics, and disciplinary regime," he told the annual FAAA Congress held in Brisbane.

"We are a profession. We should expect to be treated as such, and we should take control to regulate ourselves."

His forecast forms part of the FAAA's strategic plan for 2030, which was unveiled at the conference.

The strategy has three key pillars: members first; grow the profession; and lead the profession.

"The environment in which we operate is rapidly changing, and professional financial planners are being challenged more than ever before. The rapid pace and uncertainty surrounding regulatory change, rising costs, falling numbers of professional financial advisers, and improving public perceptions of our profession are all significant trends that we aim to address," he said.

In growing the profession, FAAA chief executive Sarah Abood said in her address that replenishing the ranks is "urgently needed" as there are now only 15,500 advisers and only about 300 new entrants that joined in the last calendar year.

One new solution the FAAA recently introduced is recognising financial planning students through the migration system to offer a path to permanent residency.

Jobs and Skills Australia shows the country is in need of "financial investment advisers", with every state and territory except Victoria showing a shortage on the Occupation Shortage List.

The financial advice occupation faces the same shortage as child carers, chefs, and aged care workers.

In November, the FAAA signed a memorandum of understanding (MoU) with the Financial Planning Standards Board (FPSB) India to help to bridge the adviser shortage.

The initiative will develop educational content and partner with universities in both countries to lay out clear pathways for certification for aspirants and subsequent professional growth.

"I want to be really clear that the offshore opportunities we're working on don't come at the expense of local students who remain our key priority. But we must broaden our base if we are serious about meaningfully increasing our numbers," she said.

"We're also working on an Advice Academy - a collaboration with Kaplan and other providers that will bring together education, mentoring, support and tools for Professional Year candidates, as well as their mentors and supervisors."