News & Views

IC Select calls for professional qualifications for investment consultants

The definition of what is accepted as a professional qualification varied between firms.  Some firms defined it as being either a qualified actuary, a Chartered Financial Analyst (CFA) or someone holding a masters degree or doctorate in finance, whilst at other firms, representing 60% of the survey, the definition also included personnel with the Investment Management Certificate (IMC), the basic competency certificate for investment managers generally completed before undertaking professional examinations.  It is possible, had the IMC not been counted as a professional qualification by any firm, that the number of lead consultants without a professional qualification could have been as high as 50%. 

The average financial experience of lead consultants was 12.5 years of which an average of 7.6 years had been spent with their current employer, whilst those in supporting roles, had 4.8 years experience with 3.3 years spent with their current employer. 

Roger Brown, founder and director of IC Select, said, “It is surprising that so few investment consultants are professionally qualified.  We would expect investment consultants to have a sound theoretical underpinning given the increasing complexity in financial instruments and the sophisticated nature of advice they now give to trustees.  It is difficult to imagine any trustee board appointing an actuary or lawyer without suitable professional qualifications and relevant experience.  Trustees should expect the same standards of their investment consultants.  The investment consulting industry needs to act together to raise their professional standards. 

In the meantime, I would recommend that all trustee boards consider carefully whether their investment consultant has the necessary competence for the advice they give.  If they are not satisfied that this is the case, they should discuss with their consultancy firm what steps can be taken to mitigate the trustees concerns.  Such an approach will increase pressure on the industry for an improvement in their professional standards.”


 For further information please contact:

Roger Brown, founder and director           

0131 221 6505

IC Select, Forth House, 28 Rutland Square, Edinburgh EH1 2BW


Tel: 0131 221 6505, Fax: 0131 221 6506.

 Notes to Editors:

 IC Select specialises in helping pension funds monitor and review investment consultants and fiduciary managers.  As a result, trustees can be more confident in the quality of their investment decisions and are able to enhance their scheme governance.


A survey, completed by IC Select, has found that 48% of investment consultants do not have a professional qualification.  The survey covered 505 investment consultants, 323 of these were lead investment consultants and 188 were investment consultants acting in a support role.  Amongst the lead consultants, 39% had no professional qualification with 60% of those in support roles currently unqualified.


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22nd November 2012