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David Thomas: A year as President of the PFS

ABR editor Rob Kingsbury spoke with David Thomas of Chadney Bulgin as he looked back on his year as President of the Personal Finance Society (PFS)

David Thomas was announced by the PFS as its President for 2014/2015 on 16 September 2015. A board member of the Society since 2011, vice president in 2013/2014 and with more than 30 years experience in financial services, Thomas says his “mission for the year” was to focus on good practice. He stresses “good practice” over “best practice” because, he says, “there are many people with good practices – but who can really say what is overall best practice?”

Taking over the presidency in 2014, the industry had gone through RDR and, as a result, had been heavily focused on qualifications, gaining Level 4 as a minimum and for many advisers, taking that further by aiming at Chartered status. Accordingly, Thomas says he felt the time was right to start concentrating again on business practices and procedures and the quality and professionalism within financial advice, hence the focus on good practice.

“What I wanted to do was find and highlight the good practice so that others could learn from them. The PFS has 35,000 members and so many of those members are following good practices. My thought was, let’s get hold of those and share them among the membership.

“So where I came from was that the Society should provide guidance on good practice, which would sit alongside the need for qualifications. And Keith Richards, the chief executive of the PFS, completely supported me in my mission.”

Good practice papers

Thomas says his first official meeting as president was with the society’s Consumer Insight Panel, which had been set up in 2014 with the intention ‘to inform, influence and support the society with its work to improve consumer confidence and trust in financial advice’.

He says: “The mission of the PFS is to help protect the public by guiding the profession but to do that, we realised, we needed to know more about the public, its perception of financial advice and what it wanted of us; hence the setting up of the panel.

“We invited all the main consumer bodies to join us on the panel. Most did, giving us a good cross section of views to help us understand what the public wants from our profession.”

One of the first issues raised by the members of the panel, Thomas says, “was that the public did not have a clue what financial advisers charged nor how they charged for their services.

“It made sense, therefore, that one of the first good practice papers we put together should be on adviser charging.”

This resulted in the Good Practice Hub in which, over the past year, the Society has published three full guides – on adviser charging, research and due diligence on DIMs, and drawdown reviews – and other good practice resources including videos and articles. “Any member can go into the Hub and read the guides. And in fact the figures show they have been viewed thousands of times,” Thomas says.

“Our hope is that with this kind of initiative the issue around adviser charging as highlighted by the panel will dissipate. It may take time because perceptions do take a long time to change but I hope we will get there.”

Given the level of interest in the papers Thomas considers this initiative has been a success. “When I became president I thought if we could get a series of good practice papers out into the market I would have achieved something. And that’s what we’ve done.”

Professional and trade bodies

One of the issues Thomas has noted during the year is the misconception of the society as a trade body rather than a professional body. “I have had people say to me that the PFS should be lobbying government and the Treasury on issues. That’s not what we’re about and it’s important to make the distinction between a professional body and a trade body.

“Our job at the PFS, as a professional body, is to guide the profession. We are not a lobbying body. That is the role of APFA (Association of Professional Financial advisers). That said Keith Richards has many meetings with the FCA and Treasury. What’s worth noting is that they are inviting him in to see them. In the work he has done with the United Profession and the Consumer Confidence campaigns, I think the FCA see him as someone who is completely aligned to them. This means we have a voice with the regulator and that will be good for change.”

Another challenge he sees is the lack of awareness among the public in respect of what the PFS is and the work it undertakes. “If you asked the public what the Law Society is, they would know of it and what it stands for, if not exactly everything it does. If we can get the Personal Finance Society in that same perception then we will be well on the way to being more of a voice. We’re not there yet which is why we want to engage with consumer bodies,” Thomas says.

“I think the PFS has a fantastic future. Under Keith we are going from strength to strength.”

Would he do it again?

Asked whether he would do it all again, he replies with an emphatic “Yes”. “I am quite passionate about change because I think we can make a difference. I have been on the board at the PFS for four years and I can see that the PFS does make a difference. Everything we are doing will make financial advice a better profession.”

The pinnacle for the profession will be for the majority of advisers, and firms, to be chartered, he believes. That said, Thomas doesn’t see the regulator raising the minimum qualification level needed by an adviser to Level 6. “Certainly not in the near term, as we’ve only just got to level 4.”

What may happen, he says, is that it will occur by default. “There is a corporate requirement that in 2020 for a firm to call itself Chartered at least 50% of advisers in the firm will need to chartered as individuals. That in itself will drive take up of chartered status among individual advisers. And from what I see, new blood coming through will take chartered as part of the normal route and they will want to do it.”

So what will he most take away from his year as president? “It’s been a great year in which I‘ve met lots of people and there are some great people in our profession. Many of them have been like a been a breath of fresh air because they are all passionate about what they do.”

And if he had to chose something to mark his achievement as president, what would that be? “Our third quarter regional conferences will see both the FCA and FOS speaking on good practice and myth busting. To my mind, you don’t get better than that and I’ll leave my term as president knowing I have delivered on the mission I had in mind when I took over this time last year.”

Visit the Personal Finance Society (PFS) website

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