The value proposition for regulating HR (Guest commentary)

Benefits include increased status, better-qualified professionals
By Claude Balthazard
|Canadian HR Reporter|Last Updated: 11/08/2011

Professional regulation represents an interesting paradox — the stated purpose is to protect the public interest by ensuring professionals are competent and act in an ethical manner, and yet the costs of regulation are borne by professionals who are regulated. Why? Since HR is not a licensed profession, members choose to be regulated and, in so doing, choose to bear the cost. Why, then, would members of a profession pay for something that ostensibly exists to protect the public? Because regulation also creates value for professionals.

An effective regulatory body signals to the public a profession is committed to professional standards of competence and conduct. Without a regulatory body, there is no reason for the public to trust practitioners to be consistently competent and ethical. In return for making a commitment to professional standards of competence and conduct and the willingness to give force to this commitment, the public responds with increased confidence, which leads to a preference for regulated professionals.

The benefits of regulation for regulated professionals are:

• an increased status

• a preference for regulated professionals in the marketplace

• an increase in the price regulated professionals can command in the marketplace

• greater control over their careers.

Professional regulation is not about telling people what they can or cannot do. It’s about creating a win-win-win situation for members, the public and government:

• The public wins by having better-qualified professionals.

• The government wins by having some control over the practice of a profession and the services provided by its members, without having to maintain the special, in-depth expertise required to regulate a profession that would be required under direct regulation.

• The regulated professionals win through higher status, better professional opportunities and greater remuneration.

The value proposition for professional regulation is similar to that of the Better Business Bureau (BBB). Businesses pay for membership in the BBB even though membership brings with it costs and obligations, because consumers find value in the fact a business is a member of the BBB.

So how much is the increased status of a true professional worth? Perhaps we can answer the question by looking at other voluntary professions. There is little doubt chartered accountants (CAs), certified general accountants (CGAs) and certified management accountants (CMAs) have greater status than non-designated individuals — they command a premium in the marketplace and the public has greater confidence in their work.

The more the public has a preference for regulated HR professionals, the more value the regulation holds. But the public needs to be aware of the difference between regulated and non-regulated HR professionals, and know there is a regulatory body that has oversight. In addition, the public needs to feel the regulatory body is honest and diligent and will discipline its members when it is warranted.

To make this value proposition work, the Human Resources Professionals Association (HRPA), as a regulatory authority, must project the following image to the public and to members of the profession: professionalism; integrity and impartiality; competence; courage to make the right decisions; and judicious authority.

Which brings us back to the question, “How does regulation create value for members?” We could redefine professional regulation as “Creating value for regulated professionals by increasing the confidence of the public in members of the profession.”

Claude Balthazard is vice-president of regulatory affairs and registrar at the Human Resources Professionals Association (HRPA) in Toronto. He can be reached at cbalthazard@hrpa.ca.

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