Home' HR Monthly : December 2015 Contents 8
A SHOT ACROSS
THE BOWS FOR HR?
It hasn’t taken Australia’s assistant treasurer Kelly O’Dwyer long to
hit the ground running. In the wake of the Murray financial systems
inquiry, O’Dwyer, one of Malcolm Turnbull’s new ministers, left
no doubt in anyone’s mind that financial planning advisers must
substantially lift their game.
She recently announced that they will be required by law to hold a
degree, to undertake a professional year, to pass an exam, to commit
to continuous professional development (CPD), and to subscribe to a
code of ethics.
One might wonder what standards financial advisers have been
required to satisfy if these particulars are now to be mandated under
legislation. Aren’t all professional practitioners required to meet
standards as fundamental as these?
The reality is that financial planners can gain a basic qualification
to practise in little more than seven days. The advice that financial
advisers give touches a great many lives and also affects the corporate
culture of financial institutions. Yet advisers might be bringing to their
practice nothing more than a self-serving desire to make commissions
on sales. To say that all financial planners operate in that way would be
unfair but to date members of the public have no way of distinguishing
between honest and untrustworthy financial planners,
and so the former suffer at the hands of the latter whose
incompetence or unsavoury practices bring the occupation
Numerous scandals have revealed that self-
regulation of financial advisers does not work and so
minister O’Dwyer has signalled more exacting entry
requirements that she will bring into law.
Regrettably, almost everything that could be said
about the standing of financial planners can be
said about HR practitioners.
There is no regulator y bar preventing anyone
who feels so inclined to set up in business as a HR
practitioner or be employed in a corporate HR role.
HR practitioners are not required to hold a
university degree, to have done a professional
year, to pass an exam, to maintain currency with
CPD, or to sign up to a code of ethics.
It might be said in defence of HR practitioners
that they are not entrusted with significant
quantities of citizens’ money. While that is
true, there is ample evidence that the difference
between good and bad HR is reflected in the
difference between healthy and toxic work
cultures, competitive and unsustainable
businesses, and happy and miserable employees.
While many HR practitioners have taken it upon themselves to
gain an appropriate university degree to inform their professional
practice, they are not required by regulation to have done so.
A great many Australian practitioners, around 20,000, are
members of this professional association, AHRI, but that is not a
legal requirement and many practitioners are not AHRI members.
Professional practising members of AHRI are required, of
course, to under take CPD and they subscribe to a code of ethics
and professional conduct which is supported by complaints and
As the HR practising environment is becoming more complex
and litigious in a more competitive global business world, AHRI has
seen the writing on the wall. And so from January 2017 all practising
professional members will be required to undertake a rigorous HR
certification credential that sets a high bar for practice.
HR certification requires a minimum professional practising
period, the equivalent of a university degree in addition to specific
professional knowledge, and also evidence via a mandatory
capstone unit that candidates seeking certification can actually do
what they say they can do.
An independent National Certification Council has been set
up by AHRI to oversee the administration of standards under
the new certification regime and to have the final say on the
suitability of candidates who have qualified for admission to
certification. The first crop of candidates are completing their
training this year and will be admitted, at the discretion of the
NCC, as certified practitioners (CAHRI-CPs) in March 2016.
In taking this action, AHRI has signalled that,
like its counterpart in the United Kingdom, it
is heading down the path of self-regulation in
the hope that will forestall any moves towards
involuntary government regulation.
The human failings within the corporate world
that star ted with Enron and ended with Lehman
Brothers and the global financial crisis find
themselves repeated too often, and increasingly
prompt questions about the role of HR. Inevitably,
questions will be asked about what HR was doing
in the midst of the recent VW fiasco. HR needs to
be coming from a better place to answer those
awkward questions, or better still, to play a greater
role in their prevention.
Chief executive officer
17/11/2015 4:23 pm
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