Last week, the Certified Financial Planner Board of Standards (CFP Board) announced that Kamila Elliott, herself a CFP professional, has assumed the role of chair of its Board of Directors.
In this leadership position, Elliott takes the helm of the professional body that certifies more than 92,000 financial planning professionals across the United States. She was elected by her Board of Director peers in 2020 to serve as 2021 board chair-elect, and, on January 1, she began serving in her new board chair role, becoming the first African American person to hold the position.
In the announcement of her appointment, CFP Board CEO Kevin Keller says Elliott is a champion for a more diverse and sustainable financial planning profession who believes strongly in showcasing how competent and ethical financial planning by CFP professionals benefits their clients’ well-being. He adds that her continued leadership and counsel will provide great value to the CFP Board as it works toward a day when every American has access to financial planning.
Elliott is also president and partner of Grid 202 Partners, a registered investment adviser (RIA) in Washington, D.C. She has nearly two decades of financial planning and investment experience assisting high-net-worth individuals, endowments, foundations and business owners with comprehensive wealth solutions and holistic planning. She spent much of her professional career at Vanguard, where she worked with ultra-high-net-worth individuals, endowments, and foundations.
This week, Elliott took some time to sit down for a discussion with PLANADVISER, recounted in Q&A form below, and detailed her goals and aspirations for 2022, noting that she is grateful to lead the CFP Board at a time when the financial services industry is shifting toward providing consumers holistic integrated advice—what the CFP Board calls financial planning.
PLANADVISER: Congratulations on your appointment and thank you for making time to speak with us today. Can you please give us a sense of what your priorities will be in the role as CFP board chair in 2022?
Kamila Elliott: Certainly. Equipped with our new strategic priorities, 2022 will be an exciting year for the CFP Board. I am eager to guide the organization as we develop bold new initiatives to raise awareness of CFP certification across the financial advice ecosystem and grow a financial planning profession that meets the needs of diverse consumers.
This year, we have two new initiatives that we will be focusing on, both of which we expect to be long-term commitments and engagements. The first is the Future of Financial Planning program, which aims to create greater awareness of and interest in the financial planner career among high school students.
As we know, a lot of people working today in this space become financial planners after a career change or after working in an adjacent industry. What we want to do is create a true pipeline that is more ongoing and organic—and diverse. Similar to the way young people think and talk about wanting to be a doctor or a lawyer, we want them to say they want to be a financial planner.
The other initiative we are undertaking this year is to do some research about what the real benefits of working with a financial planner are. We are going to be looking closely at the outcomes that come along with working with a true financial planner such as a CFP designee. We are going to examine, for example, whether those who work with planners have higher investment returns or greater degrees of financial wellness. We expect to be able to make the case very convincingly that clients should want to work with a CFP professional. Furthermore, we want them to understand the course work CFP professionals have to complete and the high ethical standards to which they are held.
PLANADVISER: Can you elaborate on the ethical standards to which CFP Board professionals are held and how the CFP Board thinks about this part of its mission? Just this week, we reported on the latest round of sanctions announced by the CFP Board. Accountability and transparency are seemingly an important part of the board’s mission.
Elliott: Absolutely, the ethical standards we define and enforce are so important.
Simply put, we as financial planner professionals should hold ourselves to a very high ethical standard, going even above and beyond the bare regulatory requirements that apply in our industry. How can I be a good financial planner if I’m not setting a good example for others? By no means are we perfect; we might have a little too much credit card debt, for example, but that is very different from some of the more egregious behaviors that we call out—things like an adviser not paying income taxes for five years. Those types of behaviors matter, and they really send the wrong signal. So we have to be focused on this and do our best to ensure ethical behavior by our CFP professionals.
Part of the reason why we are so proactive and transparent about revealing any sanctions that we file is that there is no Google review for financial services professionals. If you go to a restaurant in your hometown, you can find out a lot about it in a simple internet search. In essence, our announcements of the sanctions are our effort to create that same level of transparency and accountability. This is our way of helping people make an informed decision in terms of what professional they choose to work with.
Frankly, it can be challenging for the public and consumers to understand exactly what standards their financial professionals are being held to. One thing we talk about in our standards and codes of conduct is to really focus on ensuring that we, as CFP professionals, commit to acting in a true fiduciary capacity. We really directly outline what it means to be a fiduciary, and we ensure that our professionals live up to this standard.
One thing I’m excited to continue working on is expanding a library of case studies that help to explain to CFP professionals what it means to be a true fiduciary. Say you are working on a rollover recommendation for a client. We provide the types of questions you should ask about whether this is truly in the client’s best interest. When there are gaps in the regulatory framework, we as the CFP Board want to support our professionals and help them know what the right thing to do is.
PLANADVISER: In what ways do you see the financial planner profession evolving in 2022 and beyond?
Elliott: Stepping back, one thing we can say is that the COVID-19 pandemic has shown many, many people how financially vulnerable they are. Naturally, a lot of the planning we have been doing lately has been about generating emergency savings and the need to balance growth, wealth protection and liquidity.
What is clear is that people need to take actions to put themselves in a position to succeed financially, especially as we face new risks in the markets and potential changes in the tax codes. I am optimistic because we are seeing enormous levels of growth in this profession. We expect to have 5% annual growth in this profession over the next five years, which is remarkable and very encouraging.
We are working hard to make sure we improve the diversity of this industry as it grows, and to ensure that more Americans can access the benefit of working with a CFP professional. The other side of this effort is making sure more Americans can access what is really a wonderful and rewarding career.
To accomplish these goals, we will be collaborating closely with a variety of organizations this year and beyond, for example the Association of African American Financial Advisors (AAAA) and the Association of Latino Professionals for America (ALPFA). Collaborating with these organizations and others is going to be a very important goal of mine. I also look forward to working with a lot of the largest firms that are clearly passionate about addressing these types of issues, to create new scholarships and mentorship opportunities. It’s very exciting.