2 April 2013

CISI becomes first professional body in the world to require new capital market entrants to pass an integrity test

The Chartered Institute for Securities & Investment (CISI) has announced that from 2 April 2013, it will require candidates for its customer facing entry level examinations for wholesale/capital markets financial services activities to take and pass the CISI’s IntegrityMatters online test before sitting the exam.

The CISI is introducing this initiative to ensure that new entrants to the capital markets sector, who will be working directly with firms and clients, realise the importance of Integrity and Ethics from the moment they enter the industry.  This will also mean that integrity will be tested across the entire industry, not just in wealth management and retail financial advice.

To support this ground-breaking initiative, the CISI will be undertaking its first ever advertising campaign on transport hubs, including tube stations at Bank, Canary Wharf and Westminster, as well as mainline stations in Leeds, Birmingham and Edinburgh and many regional newspapers.

The CISI’s IntegrityMatters test, which has been a requirement for its Chartered members to take since 2009, is being introduced to the capital markets by the CISI as it believes that the standard of integrity needs to be at least equal to that of the retail sector. This will also provide the public with some tangible evidence which demonstrates that banks and other financial organisations really are changing their culture.

The CISI has commented frequently on the disparity which exists between regulatory requirements for the retail financial advice sector and those engaged in wholesale/capital markets activities. As a result of the FSA’s Retail Distribution Review (RDR) which came into effect on 1 January 2013, retail financial advisers are required to:

• Pass a higher level examination;
• Undertake mandatory continuing professional development (CPD);
• Be a member of an accredited professional body which subscribes to a code of conduct; and
• Demonstrate professional integrity.

The wholesale financial services sector - largely investment banking, which includes those working in areas such as corporate finance, mergers and acquisitions, trading bonds, shares and derivatives - has no such requirements imposed upon it.

This is the first phase of the programme, which the CISI intends to launch across its complete suite of wholesale/capital markets qualifications, including those exams aimed at the wholesale operations sector.

Existing CISI members will need to pass the Integrity and Ethics module of the Professional Refresher elearning tool, irrespective of their role, as part of their continuing membership obligations.

There will also be an opportunity for members of the public to take a free sample workshop version of the IntegrityMatters test.

IntegrityMatters (price £20) is not an exam, but a multiple stage scenario-based test, which can be taken by individuals on their own computer, either at their desk in the office or at home, with the results being made available to the candidate immediately.

The IntegrityMatters test offers users six dilemmas, all of which are based on real life examples from the financial sector. Each dilemma evolves over a series of time periods, with the choice of candidate response determining how the scenario develops.

Simon Culhane, Chartered FCSI and CISI Chief Executive said: “Over the last few years, there has been much talk about a number of initiatives which are aimed at restoring trust in financial services. This is one that has come to fruition and today we are introducing a real change.  For the first time, individuals need to demonstrate their awareness and pass an ethical test before they can consider taking the necessary examinations to enter the industry.

“Since the Institute was formed over 20 years ago, it has placed Integrity at the heart of its business, which is reflected in our charitable objectives and in our Coat of Arms with our motto, My Word is my Bond. “In keeping with our charitable objectives, we shall be donating the income from this new initiative in 2013 to the CISI Educational Trust, the Institute’s educational charity.”

Martin Wheatley, Chief Executive of the FCA said he was “genuinely pleased” to hear the CISI was taking this step to introduce an integrity test.

The CISI’s IntegrityMatters was introduced at the end of 2008 and has been completed by over 7,300 members.

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