As one of the top regulatory agencies in the United Kingdom, the announcement of the FCA’s 2022-2025 Strategy has offered financial firms guidance into regulations, focus areas, and operations for the coming years. Such insight allows UK firms to align compliance program priorities with the regulatory action being taken by the authority.
While the full announcement and strategy covers multiple points for compliance, we’ve broken down the key focus areas within the FCA 2022 Strategy — all of which result in critical outcomes designed to improve compliance across the financial industry.
As the Chief Executive, Nikhil Rathi, stated in his opening remarks, “We are now focusing on results rather than being driven by processes. Our Strategy sets out, for the first time, the outcomes we expect all firms to deliver across our markets.”
Such key outcomes include:
- Confidence
- Fair Value
- Suitability and treatment
- Access
The FCA’s 2022 Strategy Focus Areas
1.Reducing and Preventing Serious Harm
“We’re focused on protecting consumers from the harm that authorised firms can cause. We’ll use our full range of tools from competition to policy and from supervision to enforcement so we address these causes of harm efficiently and consistently. We’re building on the changes we’ve made to how we operate so we act faster, protect more consumers and, where we can, prevent harm before it happens.”
2. Setting and Testing Higher Standards
“Focusing on outcomes will help to identify problems earlier, so we – the FCA and regulated firms – can prevent problems escalating or becoming widespread. By focusing on outcomes, we’ll give firms greater flexibility. We will promote effective competition to help drive these higher standards and push firms to be responsive to consumer and market needs. Firms need to understand their consumers’ needs and to have the flexibility to support consumers so they get good outcomes. This is particularly important as consumers face increasing financial pressures…We expect outcomes-based regulation to adapt to technological change and market developments, meaning consumers are protected from new and emerging harms and firms can innovate to find new ways of serving their customers with certainty of our regulatory expectations.”
3. Promoting Competition and Positive Change
“Our aim is to have open markets, supported by accessible rules. Our high standards support firms to grow and innovate, and our competition enforcement powers enable us to step in where firms restrict competition…Competition should be a force for good. Firms should compete for customers on the basis of service, quality, price and innovation. Competition should encourage better outcomes for consumers. We will make sure our standards reflect current and emerging risks, while enabling innovation and competition in consumers’ interests.”
For help navigating the latest focus areas and scope described within the FCA 2022 Strategy, or to discuss the role of technology and automation in your firm’s compliance program, schedule a demo today!