Would Your Firm Withstand CEFEX Certification?

How would your firm fare if you opened up the firm’s process, practices and procedures to the scrutiny of an outside professional, trained to assess how well it conformed to the fi360’s “Global Fiduciary Standard of Excellence?” Would it be worthy of certification from the Centre for Fiduciary Excellence (CEFEX)?

“Letting someone come in to look at how you are running things is a very sensitive subject,” said Carlos Panksep, general manager, CEFEX. Panksep and  Richard Carpenter, CEFEX Advisory Council member and president of USVI Pensions and Consulting, spoke with AdvisorOne during the 2011 fi360 Conference in San Antonio on May 5. That kind of “transparency is notable in this industry,” Panksep adds.

That is exactly what CEFEX-certified firms do, however—every year. First, an Accredited Investment Fiduciary Analyst (AIFA) (who cannot be associated with the candidate firm) works with that firm, going through the firm’s processes to see what more they must do to prepare for the assessment. The analyst looks at the firm, Panksep explained, to see if, "in process, they are they running a good business, with good fiduciary practices.”

Where they find gaps, the analyst will let the firm know that there is “opportunity for improvement; you can do better on this fiduciary practice,” Panksep said. Later the analyst looks again to see how those “opportunities” have been put into practice.  According to Panksep, this “instills a culture of continuous improvement” at these firms. They “know the fiduciary will come out again to follow up. It’s an annual certification.”

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