Director wannabes face a tougher IFSRA test

FINANCIAL services regulator IFSRA is planning a shake-up of how it judges the competency of individuals who apply to become company directors.

The regulator yesterday proposed several changes as to how it judges the “fitness and probity” of individuals looking to become senior managers and directors of financial services firms. Under Irish and EU laws, anyone looking to become a director must pass a test set by the regulator to ensure they have the competency and integrity.

“Customers must be able to trust their financial services providers to protect their interests and treat them fairly,” IFSRA chief executive Liam O’Reilly said yesterday.

“Responsibility in individual firms for delivering financial services that meet these standards rests with directors and managers. These individuals are placed in a position of leadership and trust in firms and must act honestly, ethically and with integrity in every aspect of their business.”

The current test seeks to ensure that those appointed to senior posts have the necessary qualifications, skills and experience for top level jobs. The regulator also tries to ensure that individuals are honest, fair and ethical.

The review of these guidelines comes after a turbulent years for the banking and financial services sector.

The new guidelines proposed would require anyone looking to become a director to disclose that they are tax compliant. It wants directors to provide a tax clearance certificate from the Revenue every year. IFRSA also suggests that if an individual has had dealings with a tribunal of inquiry or other bodies, such as the director of corporate enforcement or a professional body, this would not make them suitable to become a director.

The consultation paper added that if an individual failed to manage finances, but at no loss to anyone else, it would still have to look at whether the person was suitable.