With only one month remaining to comply with the requirements of the new Consumer Duty, the FCA has published 10 key questions on what firms should be asking themselves in their final push to implementation. The questions range between all of the four outcomes, analysing key components that firms should have implemented during the past 12 months.
How should firms look to answer the questions?
Firms should map the questions to their implementation plans and project deliverables to ensure that the themes of the questions have been considered and incorporated into their Consumer Duty strategies. The most crucial component the FCA will be looking at is the evidence that firms will be using to support their responses to the new questions.
The following actions (non-extensive list) could be used as evidence to demonstrate how firms have met the mark with just one month to go:
- Policies and Procedures [1, 5, 6, 7, 8]* – what new documentation and protocols are in place which embeds the activities that should enable the firm to deliver good outcomes going forward;
- Communication analysis [5, 6, 7, 8] – what reviews have been conducted on all communication strategies and marketing materials to ensure that all customers are able to achieve their financial objectives and facilitate effective decision-making;
Cultural shift [9]:
- Training – what training has the firm conducted, e.g., Vulnerable Customer training or Consumer Duty specific training, which has spread awareness of the new Duty across the organisation
- Senior Management engagement – throughout the implementation period what workshops and sessions have been held with Senior Management across the organisation to maintain engagement
- Monitoring set-up [3, 4, 5, 7, 10] – does your firm have any tools set up, such as Management Information dashboards or fair value assessments which will be used to monitor ongoing compliance with the Duty and the firm’s ability to deliver good outcomes;
- Product assessments [1, 2, 3, 10] – has the firm conducted extensive reviews of the design and pricing of their products to incorporate fair value considerations and avoid foreseeable harm, if so what documentation is available to evidence this;
- Distribution reviews/target market analysis [1, 2, 6, 10] – what analysis has been completed to ensure that the firm is able to mitigate the risk of product mis-selling and negative target market outreach?
*[the numbers are preliminary mappings to the FCA’s questions]
The examples above can be used as supporting evidence when answering the questions from firm’s perspective, emphasising the steps that have been taken over the past 12 months in order to meet the new requirements of the Duty.
How Delta Capita can help
Delta Capita’s UK Consumer Duty team comprises senior industry practitioners and former C-suite banking executives. We support organisations in delivering the changes required to deal with complex challenges. Whether you need help to assess your Consumer Duty readiness or benchmarking to peers across the industry best-practice post the July deadline, our team can help you as we are helping other organisations with similar challenges.
To find out more about how we can support you, contact us and speak directly to one of our experts.
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