The rise of the financial planning industry

The financial planning industry in Australia has experienced significant reform in the last decade. This reform has not only made a considerable impact on financial planners but also on other groups such as the accounting profession, regulators, the financial services industry, educators and consumers. Although consumer protection was at the heart of this reform, it has also prompted the industry and other groups to consider financial planning as a profession. This paper begins with a definition of financial planning, followed by a discussion of the historical origins of financial planning. Several examples are used to illustrate how the industry has developed and changed over time considering the impact of social, cultural, institutional, political and economic factors. Particular attention is given to the role of the accounting profession and government regulation in Australia. The paper concludes with a discussion of the professionalisation of financial planning in light of the increased pressure for changes in remuneration practice in the industry.