Views on improving the integrity of global capital markets
29 March 2015

Apathy Toward Continuing Ed, Flawed Business Models Fuel Bad Behavior in Finance Sector (Video)

A lot has been said about using training and education to change patterns of bad behavior in the financial services industry. Firms have been requiring staff to get professional qualifications, undergo ethical decision-making training, attend seminars, and participate in many other well-intentioned efforts. Is anyone really taking it seriously or are people just going through the motions?

Paul Smith, CFA, president and CEO of CFA Institute, talked with Hubbis, a wealth management conference organizer in Asia, about the “profoundly depressing” attitude toward continuing professional education in financial services, where people try to get the most for the least effort. (Video below.)

Traditionally, membership in a profession meant that one possess a high degree of competency, skills, and education, and ethical responsibility to act in the best interest of clients. Thus, it behooves professionals to remain on top of developments in their fields to best serve clients. However, Smith notes, that financial and investment professionals don’t seem to think of themselves that way, hence the apathy toward continuing education.

Moreover, the current approach to improving behavior also seems to assume that the problem lies with a few “bad apples” instead of the quality of the “barrel.” Smith argues that no amount of training or indoctrination will be successful unless firms reform inherently conflicted business models. “Unfortunately regulation is not the answer, but regulation is going to be the answer,” he says.

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2 thoughts on “Apathy Toward Continuing Ed, Flawed Business Models Fuel Bad Behavior in Finance Sector (Video)”

  1. Stephen Campisi, CFA says:

    I disagree most whileheartedly and in fact quite vehemently. Investment practitioners and especially Charterholders are devoted to continuing education as a required part of their careers and because it is simply a prcatical reality of the industry. You either keep up or you get left behind. I believe that Smith’s comments are rooted in his personal perspective that continuing education must be the result of a formal process administered by a centralized group such as the CFA Institute. He should accept the reality that the Institute put this measure before its membership, throwing a huge marketing effort behind it, complete with roadshows by its leadership as part of its big push. The membership rejected the idea of a formal requirement, choosing instead to continue learning in the many self-directed, customized, relevant programs that each member self selects. That’s good enough for the members; why isn’t it good enough for the Institute?

  2. Heda Bayron says:

    Mr. Campisi, thank you for sharing your candid views on this matter.

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