New FSA requirements mean that top executives need to sharpen their skills. But how seriously are bosses about training. Brian Hanney reports
The N2 introduction of the Financial Services and Market Act introduced tough new rules where senior executives are personally held responsible for technical performance. Never has there been more pressure on senior directors to be up to speed on issues such as employment law, record keeping and competence.
But do current training regimes take this into account?
Experts fear that the training programmes have not moved with the times. Robin Wood, a specialist in training and competence in the insurance industry, says: "Someone running an insurance company or brokerage should understand the Data Protection Act, but how many actually do? The reality is that a lot will have gaps in their knowledge.
"Those that run the training courses and sell exams need to define now what these people need to know.
"They need to take a risk management approach and look at the threats this new regulation brings and ensure that their training is focused on this."
Training for those at the top takes different forms. Sometimes it is done in-house, sometimes with outside consultancies and often a combination of the two.
The emphasis is more on development and spotting skill gaps. In this approach the courses are tailored to the individual and focus on leadership, often at a high corporate level, demanding the training resources of international business schools.
Bupa says it has paid much attention to regulatory and compliance training in recent years. HR director (UK membership) Graham Dunning says: "We have to make sure we meet and maintain our technical toolkit."
"We use a variety of sources in terms of training and development," he says.
This includes networking, conferences and the use of consultants to organise workshops.
"But acquiring a set of skills on a training course is going to deliver only 20% to 30% of what you need to do the job well," Dunning says.
Development is also important as part of the "psychological contract".
A problem though is that not all senior managers embrace the idea of training immediately. Wood says: "The precise problem is asking senior managers to be assessed. There seems to be a reluctance."
Many broking firms, who will face the FSA regime in 2004, feel they cannot spare the time and of course training can be expensive, with courses costing anywhere from £600 to £1,700. "There is a lot of nervousness of management believing it always has to cost a fortune, but it's' a question of shopping around," says Wood.
Finding time to train should not be an issue, says Allianz management development manager Joan O'Byrne.
"Training is more of an attitude of mind than a time issue. The very best managers are able to manage their time so that continuing professional development becomes an integral part of delivering a professional job for their employees.
"People at the top focus on the business and lead the staff, and their ability to do this at the optimum level is reduced if their training needs are ignored or poorly met."
Churchill Insurance human resources director Marie-Ange Bouchard admits that some managers are "pretty cynical" at first about training, but says the feedback and follow-up that trainers receive is positive. Her company decided several years ago to design a leadership programme, Arista, for senior managers.
She says: "It is a constant programme. We don't give them one week then forget them." Every 18 months, senior managers undertake a programme for which there is constant feedback. Training covers several areas, including management style, policies and procedures and how to handle grievances.
Bouchard adds: "It is in-house, but we may ask for outside consultants to deliver the training. We need to know people are able to lead their teams."
For Legal & General (L&G), emphasis is also put on international training. Head of remuneration Geoff Tucker says: "The more senior you get, the more you need developing rather than training."
The company favours sending its senior people on week-long courses to institutions like Harvard or the London Business School to "think away from things".
Tucker says there is some in-house development, but it has to be individual. He adds: "Quite often it doesn't happen formally. You're still being trained even if you're not going on a training course."
He also accepts that with senior people, "it's difficult to get them away".
But he says they can pick up new skills through their everyday work, often by being moved into a different job for a year or two.
Large brokers, such as Aon and Willis, have in-house training schemes, but the British Insurance Brokers' Association (Biba) also offers training to senior managers in smaller companies.
It ran two such schemes last year and plans to roll out more this year for managers, covering issues such as liability and business interruption.
Biba's David Crump says senior managers of smaller brokers look to Biba to help with training in areas such as assertiveness and project management. But he admits most prefer a one-day "quick hit".
"They can't go away for two or three days and have no one back at the office. They want training with immediate relevance," says Crump.