Glossary term
Firm Element
The Firm Element is the part of FINRA continuing education that broker-dealers design and administer for their registered persons.
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What Is the Firm Element?
The Firm Element is the firm-run part of FINRA continuing education for registered persons at broker-dealers. It requires each member firm to evaluate its training needs and maintain a continuing education program that fits its business, registered people, products, risks, and regulatory developments.
Unlike the Regulatory Element, which is assigned through FINRA, the Firm Element is built and administered by the firm. It is meant to keep registered persons current on the responsibilities and risks of the work they actually perform.
Key Takeaways
- The Firm Element is a broker-dealer's internal continuing education program for registered persons.
- FINRA rules require firms to evaluate training needs and maintain a written training plan.
- The content should be tied to the firm's business, products, responsibilities, risks, and regulatory developments.
- It is separate from the Regulatory Element, though both are part of the continuing education framework.
How the Firm Element Works
Each firm must assess its own training needs at least annually. That assessment should consider factors such as the firm's size, structure, business activities, regulatory developments, registered persons' roles, and performance in the Regulatory Element. The firm then develops a written training plan and documents completion.
The training may cover sales practices, product risks, supervisory responsibilities, cybersecurity, anti-money laundering, communications, conflicts of interest, senior investor issues, complex products, or other topics relevant to the firm's business. The point is not to deliver generic training for its own sake; it is to address the actual compliance and professional responsibilities of registered personnel.
Firm Element vs. Regulatory Element
Element | Who administers it | Main focus |
|---|---|---|
Firm Element | The broker-dealer | Training tailored to the firm's business, products, and registered persons. |
Regulatory Element | FINRA through assigned CE content | Rules, regulations, ethics, and category-specific regulatory topics. |
MQP CE | FINRA for eligible former registrants | Maintaining qualification after registration termination. |
What Firms Document
A firm should be able to show how it identified training needs, what content was provided, who was required to complete it, and whether completion was tracked. The training plan is part of the firm's broader supervisory and compliance framework.
For registered persons, the Firm Element can be practical because it often covers the issues they encounter in daily work: customer interactions, product recommendations, records, disclosures, escalation procedures, and internal policies.
The Bottom Line
The Firm Element is the broker-dealer's responsibility to keep registered persons trained on the risks and obligations of the firm's business. It complements FINRA's Regulatory Element by making continuing education specific to the firm.