The FSA requires competent staff in the industry, but how a company achieves that through training is its own responsibility. Martyn Wailen highlights some of the issues involved

Through the provision of rules and principles the FSA has made it clear that the competence of staff operating in the insurance market is as important to them as is ensuring that companies comply with the wider regulatory framework.

Since January 2005, the FSA has issued a number of enforcements that have mentioned the shortcomings of various training and competence (T&C) regimes.

Given that the FSA is keen to further explore "the state of the market" we can be sure that T&C will be included.

Broadly, under its "commitments" the FSA expects regulated companies to be able to prove that:

  • Staff are competent
  • Staff are maintaining their competence
  • A companies approach to staff development is appropriately supervised
  • Records are kept in relation to development
  • And in circumstances where more onerous regulation is attached to certain functions there will be a further need to ensure that staff are competent to perform in their given roles.
  • Senior managers and directors are also subject to T&C scrutiny. A company must have appropriate devices in place to ensure that their development needs are also catered for.

    How a company embeds this into its operation is down to the company, as any development programme must fit its business. However, the FSA message is clear: if you do not embrace and allow for the appropriate development of your staff, how can you tell us that you are ensuring that they are performing their roles in a manner that is compliant with our regulation?

    Given the importance of the issue how do we cater for the increase in demand placed upon us?

    Quite frankly a lot of what is expected of us now has been undertaken in the market by the most practitioners for some considerable time. If you want to be a market leader or run a tight ship, then staff should know their responsibilities and be given access to training and development in order to perform, compliantly, to the best of their abilities.

    The FSA rules have shifted the bias of how a company caters for training away from the development 'department' alone and into the hands of an approved person responsible for "apportionment and oversight".

    Given that there are more principles to comply with and that development of non-regulatory issues should also be maintained, an emphasis on staff competence should now be seen running through the business as a whole.

    For example, compliance departments now have a major role to play in judging what regulatory training should be carried out within business functions, and to what level. Line managers are also increasingly aware that the competence and awareness of their staff is a primary objective.

    In line with this is the development department ability to meet the needs of the business through consultation and the running of appropriate programmes.

    In the lead-up to January 2005, when general insurance regulation took effect, what was your organisation doing to put you on the front foot when it came to regulation?

    Perhaps you witnessed an increase in FSA awareness workshops and a whole raft of internal communication on the impacts facing your businesses? More importantly, now the initial furore has died down what are you doing about T&C within your organisation?

    A number of companies have had to re-examine how they are catering for their development programmes, given the increased need, potential spend and the fact that there are a number of ways to achieve those aims.

    Training media
    We need to be on the 'blended' approach to learning and development.That is, we should be employing a variety of training media to best cater for how staff learn and the ability to have a number of different measures in place to cater for their needs.

    For example, we should offer our staff access to professional qualifications. There are a number of bodies in the marketplace that offer recognised qualifications that are acceptable to the FSA, notably the CII and IFS.

    Internally, companies should continue to offer the internal workshops to delivering training. These offer delegates access to in-house experts, and bodies such as the Financial Services Skills Council can also accredit the quality of internal trainers and their training materials.

    More and more companies are also employing e-learning to deliver training to their staff. One of the ways e-learning can be employed is to deliver 'just in time' training. For example, if

    you want to deliver, and maybe even test, training of staff in respect of Treating Customers Fairly, e-learning may be the way to ensure consistent and accurate delivery of your messages.

    Other worthwhile media could include external workshops, such as those the FSA runs, access to self-learn material - books, DVDs, audio tape and peer training.

    These methods can be used to enable the attainment and then maintenance of staff competency. But you must choose the options that best suit your business operations.

    Whatever methods you are using you must ensure that whatever development is undertaken that it is recorded. If it isn't, then it is as if the training never took place.

    What should also be remembered is that the industry is facing an ever changing regulatory landscape, we have to keep pace with what is expected of us.

    In the case of Treating Customers Fairly alone we are expected to not only understand the principles as a commercial organisation, but also that we ensure the delivery of our message through all our staff.

    It may be that what we train staff to achieve this year will be very different to next.

    This places great emphasis on the business working together to co-ordinate and deliver the necessary development.

    By taking the view that not only must you deliver appropriate development opportunities to your staff, but that development is integral to the success of your company, then there are of course serious benefits to be had.

    You should find that your staff become more knowledgeable, more competent and better placed to perform at the height of their talents.

    Staff development will help you to control the risks within your business and will help you attract and retain the key individuals who will drive your business now and in the future. Just remember not to take your eye of the ball. IT

    'Martyn Wailen is with Proficiency Solutions, the online training arm of Cardif Pinnacle

    The FSA rules have shifted the bias of how a company caters for training away from the development 'department' alone and into the hands of an approved person