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November 19, 2006 at 02:00 PM
Educational directors of programs leading to the Certified Financial Planner designation breathed a collective sigh of relief following the departure of the CFP Board of Standards’ former CEO and the appointment of an interim CEO pending a permanent replacement.
On October 30, the CFP Board welcomed Don Tharpe as interim CEO, who will manage the board’s operations while the Board of Governors completes a search for a new chief executive. Tharpe replaces Sarah Teslik, whose tenure during the past 2 years generated controversy. Among other irritants, critics questioned Teslik’s staff cutbacks, rejection of program directors as “stakeholders” in the CFP marks and a management style that some described as “distant,” “uncommunicative” and “arrogant.”
“Program directors are very upbeat about her resignation,” says Somnath Basu, a professor and CFP program director at California Lutheran University, Thousand Oaks, Calif. “Her departure is definitely a positive development for the stakeholders. During her term, the communications were all one-way.”
Rosilyn Overton, an assistant professor and graduate coordinator of the masters of science in finance and the professional planning program at New Jersey City University, Jersey City, N.J., agrees, adding: “[Teslik] was not inclined to consider us stakeholders in the education of future CFP certificants. She didn’t value our input.”
A spokesperson for the CFP Board describes Teslik’s departure as “voluntary.” Calls placed by National Underwriter to the CFP Board for additional information respecting the change in leadership and other decisions of the board were not returned. According to the board’s October 12 press release, Teslik will become a senior vice president of policy and governance at Apache Corporation.
Observers laud Tharpe’s 25 years of experience managing non-profits, including 12 years as executive director of the Association of School Business Officials International. But they stress that his permanent replacement should also have a good understanding of the financial planning profession, as well as the “passion and vision” to distinguish the CFP marks from other designations.
The change in leadership follows an October 24 meeting of the CFP Board’s Board of Governors, held in conjunction with the Financial Planning Association’s annual conference in Nashville, Tenn. There, the board announced the establishment of a task force to consider 336 comments–including input from the FPA, CFP certificants, and the public–on proposed revisions to the CFP Code of Ethics. The task force will address the comments in January of 2007.
Chief among the FPA’s objections to the proposed revisions is Rule 1.1 of the Rules of Conduct, which would require a CFP certificant to indicate in writing what legal standard will govern the agreement between the certificant and the client. If no legal standard is designated, the default standard is that of a fiduciary. In a Sept. 25 letter to the CFP Board, FPA President Daniel Moisand wrote that the proposed rule would result in “greatly varying standards of conduct for CFP certificants,” rather than a strengthening of standards that the board seeks, and thus placing the rule in conflict with the CFP Board’s mission.
“They hit on all cylinders,” says Moisand. “We’re very pleased with the board’s decision [to revisit the code in January]. We agree that it is time to bring the code of ethics and the practice standards up-to-date, eliminate redundancies, and make it easier for certificants to follow and for the board to enforce.”
