The final exam in the Pension Management Institute (PMI) Advanced Diploma in Retirement Provision (ADRP) focuses on the two key areas which will remain important not only for all new pension professionals embarking upon their career, but for all of us throughout our working lifes: Professionalism and Governance. Any student seeking to enter this exam should ensure they have read the syllabus so they know what is expected of them to pass. Having been an examiner for a number of years, it is surprising that this seems to be the least read part of any study material. The syllabus tells students what they are expected to do to be successful in any of the PMI’s exams. Another good source to assist students is the Examiners’ . It gives guidance on how well past students have interpreted previous exam questions and is a very useful tool in understanding what is required to pass the exam.
The professionalism aspect of the exam seeks to test how we would behave as individuals in our business lives. The PMI’s requirements could apply to any profession in that it demonstrates the ethical standards required of a professional. For us, this means in whichever area of pensions in which we work. It is covered by sections one to three of the syllabus and, although it can pick up other areas, it is mainly focused on PMI’s Code of Professional Conduct (the Code). In order to pass the exam, students must be able to demonstrate an awareness of the professional standards (within the Code), to understand we must continue to develop personally as we progress through our careers and to understand how professional ethics underpin how we should act.
To test the three areas of the syllabus, the examiners seek to replicate different scenarios through three or four short case studies.
Many students struggle with this part of the exam. It is important to note the Code is not a set of instructions, it is outcomesbased and sets out what ethical behaviour is expected of anyone who is a member of the PMI. Whilst, of course, there will be some reliance on law, regulation, corporate policies etc. the exam expects students to take responsibility in interpreting how these apply. Therefore, we not only need to read and learn the words of the Code to pass the exam, we also need to demonstrate we understand how to interpret the Code practically within many different circumstances. It requires us to think about what we would do personally and what is expected of us as a pensions professional. This does not mean individuals are expected to act in a priggish or puritanical manner, common sense and pragmatism come into play here.
The Code emphasises how integrity is the foundation to professionalism. It gives us guidance by setting out how we are expected to act. What is more important, is that once we have achieved the Diploma we must ensure we continue to apply the Code.
The Code emphasises how integrity is the foundation to professionalism. It gives us guidance by setting out how we are expected to act.
Governance is more structured and pension-focused, and the manual covers sections four to nine of the syllabus, which requires us to: + Explain the financial impacts of running schemes, from the commercial costs of doing so, to managing contractual relationships.
+ Understand that managing, monitoring and measuring the services that schemes receive from their various providers is how to understand whether a scheme is receiving a good service.
+ Understand why management and oversight is important in running a pension scheme
+ Be aware of what needs to happen when selecting, monitoring and changing investment managers
+ Know the internal controls required to run a pension scheme and how to manage risks, and finally,
+ To be able to explain the role of trustees in managing risks in pension schemes.
It seeks to build on the knowledge gained in the previous modules and asks us to apply this knowledge in managing risk within pension schemes. Only those who have read, learnt and understood the Governance Manual can produce answers with sufficient technical marks to pass – as long as they also answer the question posed by the examiners!
Governance is tested through a more comprehensive case study requiring an answer in a specific format, as described in the Communications Manual, and can cover a number of areas within the syllabus. There are marks available for producing the answer in the requested format using the right tone and do not forget grammar. Every year there are students who lose these valuable marks.
A final point must go to managing time during the exam. Appropriate time needs to be allocated to each question.
A good plan is worth its weight in gold and helps us create answers which demonstrate to the examiners we have learnt and understood the study material. Good Luck!