In November in Canberra, the Profession of Independent Financial Advisers (PIFA) held its 2019 symposium, attended by the principals of around 30 financial advice firms that conform to the Corporations Act Section 923A definition of “independent”.

These are firms that do not receive commissions (or rebate them in full to the client), including on life insurance; do not charge asset- or volume-based fees; and have “no ties to product manufacturers” which may influence their actions or advice.

There aren’t many advice firms or licensees that meet this definition. Most fall foul of one or more of the forms of remuneration or structure that disqualify them from legally using the term “independent” to describe themselves or their services. The definition of independence is interesting and has been the subject of debate in the industry before. The government has agreed with the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry that advisers must give retail clients a statement explaining why the adviser is not independent, impartial and unbiased, before the adviser provides personal financial advice, unless the they are allowed to use those terms under s923A.

Characteristics of independence, impartiality and lack of bias are among those that consumers say they want in financial advisers (see chart below). But this is only one of the interesting things about PIFA and its members, and not even the most interesting one. In May this tiny association, headed by its president Daniel Brammall (pictured), formally lodged an application to establish a professional standards scheme.

Among other things, but the one most often spoken about, a professional standards scheme allows members to cap their civil legal liability. But it is so much more than that. It would establish, beyond reasonable question, financial advice as a profession.

This article originally appeared on Professional Planner. To read the full article please visit Professional Planner.