30.09.2016

New FCA Measures Continue to Support Firms’ Focus on Culture

New FCA Measures Continue to Support Firms’ Focus on Culture

In what has been a turbulent regulatory time, one thing has remained consistent throughout – the focus on culture change in the Financial Services sector. We are now six months into the new Senior Managers’ and Certification Regime, and the FCA has this week revealed plans to add more measures to further strengthen its success across the sector.

It is reported that these new measures will continue to build on the regime’s focus on individual accountability, and clarify how firms are expected to view the roles of senior managers within their organisations. In support of the new regulations, the FCA is also set to publish a discussion paper about how those heading up the legal function in firms should be treated under the Senior Managers' and Certification Regime.

Andrew Bailey, Chief Executive of the FCA, said: “Six months on and, in a great many cases, firms have made a substantial effort to get this right and embrace the importance of the key principles underlying the Senior Managers and Certification Regime, namely responsibility and accountability."

Knowing who is responsible for what is critical for firms and regulators and we have seen genuine engagement on this from the Board down. - Andrew Bailey, Chief Executive, FCA

“Generally, we have observed that firms are taking their responsibilities seriously and have broadly got the regime right. But we recognise culture change takes time and there is still more to do. So we have to keep a watchful eye on the progress firms are making.”

Topics of responsibility, accountability and governance in financial services firms and their impact on conduct has been, and remains, a priority for the FCA with a focus on the most significant drivers of good or poor mindsets and behaviours. Ongoing focus around these new regulations is testament to the FCA’s determination to succeed in exacting cultural and behavioural change across the board – something that shows no sign of letting up.

The FCA has also confirmed to consult on a number of other areas in the coming months:

  • Guidance for Senior Managers on the ‘Duty of Responsibility’
  • A new requirement for UK branches of overseas banks to tell their UK based employees about the whistleblowing services offered by the FCA and the PRA
  • Extending the conduct rules to all non-executive directors of banks and insurers

Read more about the new Accountability Regime here.

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