The FSA should give more emphasis to ongoing skill development and CPD when it assesses if firms are meeting Training & Competence requirements, advisers urge.
Research commissioned by the regulator also found firms would welcome greater detail on how the T&C regime could be met but would not want a return to the previous prescriptive approach.
They call on the FSA to give greater weight to the application of skills and Continuing Professional Development (CPD) rather than just focusing on qualifications.
However, the regulator defended its approach saying the perception it does not pay enough attention to 'soft skills' within the TC requirements is incorrect.
"Our competence regime focuses on skills, knowledge and expertise. However, we address consumer protection issues through the TC requirements by applying an objective baseline of competence, so naturally the requirements focus more on qualifications as an appropriate method of introducing that baseline. This does not mean that we do not place equal importance on skills and expertise.
"Instead, we leave it for the firm to decide how best to implement these aspects of competence and expect them to evidence the effectiveness of those measures."
It said it was encouraged by examples of good practice, including focused monitoring
of advisers with a clear career path and setting out how they can progress to more
"There is also evidence of firms using paraplanning as a career development route and using output based measures in TC schemes. We are pleased that firms are integrating TC and our Treating Customers Fairly initiative."
It emphasizes that a supervisor's role is paramount in ensuring good quality competence assessments within firms. "For the avoidance of doubt: a file check is not supervision," it says.
The FSA also said it expects firms to equip their individuals with the skills and knowledge
to educate consumers.
It found consumers have heightened concerns about levels of compensation for various financial products and services and it expects firms to train their employees to to provide information about the protection provided by the FSCS.
Putting the tech into protection
Square Mile’s series of informal interviews
Fallout from Haywood suspension
Launching later in 2019
£80bn funds under calculation