IAN FLEMING'S James Bond may have a licence to kill. However, without the appropriate licence from the Securities and Futures Commission (SFC) not even Bond would be allowed to give professional financial advice or deal in securities in Hong Kong. Licensing is necessary for all practitioners carrying out regulated activities. The SFC licensing guidelines state that 'it is a serious offence to carry out regulated activity in Hong Kong or target the investing public without the required licence or registration'. To ensure high standards in the financial services profession, the commission outsourced its licensing examinations to the Hong Kong Securities Institute (HKSI) in 1997. In 2003, it followed this with the introduction of a single licensing scheme under the Securities and Futures Ordinance. This ordinance states that anyone practising in regulated areas of financial services has to possess the necessary licence covering the areas of their specialisation. The securities institute developed the present licensing examination with the assistance of regulators, academics and practitioners from the financial services industry. There are nine regulated activities ranging from dealing and advising in securities to asset management. Regulated activities that financial professionals are permitted to carry out are specified on their licences or certificates of registration. Gary Cheung Wai-kwok, chief executive of the HKSI, said: 'Any person professionally advising and dealing in stocks and shares, including those offering financial advice in banks, insurance companies, pension companies and fund managers, need to be licensed.' Two groups in the financial services industry need to have licences - sales representatives who sell financial products and officers who are responsible for staff, management and protecting investor interests. The first step to getting a licence is to enrol for the licensing examination. 'No degree is needed to take the examination. It is an open entry and provides a good stepping stone for school-leavers or indeed anyone wanting to engage and build a career in the financial services industry,' Mr Cheung said. Candidates taking the licensing examination must clear one compulsory paper and two practical papers from a choice of 10. Once these have been cleared, a candidate is awarded the institute's practising certificate. The examination can be taken monthly and questions are based on self-directed study from the institute's manuals. It takes between 80 hours and 90 hours of preparation for each examination paper. The papers are offered in English and Chinese. The HKSI also offers an alternative and advanced route to getting a licence in the form of the professional diploma in financial markets (PDFM). The diploma is a five-year programme but can be completed in one year. It provides a two-pronged approach to professional development. Those with the basic licence can study for the PDFM to add to their level of existing competence and licensed activities. Others can take this route if they also want to pursue academic or international professional qualifications. Completing specific modules of the diploma programme allows students to enter the final year of the BA (Hons) financial services degree at either Napier University in Scotland or the University of Hong Kong School of Professional and Continuing Education (HKU Space) and also join the master of finance programme at Curtin University of Technology in Australia or Hong Kong Open University. 'We call the PDFM a one-stop shop because passing it qualifies anyone for almost all the SFC exam requirements except foreign exchange. Also someone could be awarded a degree in one year after completing the PDFM,' Mr Cheung said. Training for all professionals is continuous. The licensing examination and PDFM are just two of many courses that the HKSI offers along with seminars and continuous professional development programmes. Getting a licence is a good stepping stone for anyone considering a career in the financial services industry. The licensing scheme also helps to ensure the quality of advice consumers receive. 'One of the basic requirements of anyone giving financial advice is to assess a client's objectives. It would be inappropriate for an adviser to sell an 80-year-old something that would not allow them to get their principal for five years,' Mr Cheung said. 'Having cleared the exam papers, the next step is to secure employment in the industry. 'Through the employing firm, individuals with the HKSI examination result can apply to the Securities and Futures Commission's licensing department. Before granting a licence to practice, the commission would also check if the individual meets other competence requirements such as being fit to work in the industry,' he said.