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Consumer Duty Implementation: Plans Must Now Be In Place

31 October 2022 is a date that looms large for Senior Managers of financial services firms. And, unlike the UK Government’s budget, that date is set in stone. But just like Jeremy Hunt, we should expect that the content of our plans will be scrutinised and challenged. That’s what the FCA says Boards should expect following the publication of their Consumer Duty implementation plans.


The Financial Conduct Authority’s new Consumer Duty represents the biggest regulatory shift in the last decade, and with an extremely tight implementation timetable, financial services firms have had to work hard to begin preparing for the Duty. The FCA’s July 2022 policy statement made clear just how fast a turnaround they were expecting, with the Duty applying to open book products from July 2023 – giving firms just a year to prepare.

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The same paper set a deadline of the end of October 2022 for the agreement of implementation plans. These plans must be detailed enough to enable all departments to understand how the Duty will be applied, how it will affect them, include clear deliverables and show how the whole firm will meet the new standards.


This deadline doesn’t mean that implementation activities must have been completed, but the plans must be decided and agreed on. Knowing what to focus on, even at high-level planning, is difficult to pin down; the Duty touches all activities within applicable firms and is hugely wide ranging. What firms need to focus on will depend on their business activities, but broadly, the following are a good start:


SM&CR: Implementation plans need to make sure that new responsibilities are mapped, that those who need to be trained on the changes to the Conduct Rules understand what the updates mean for them, and how the Duty will impact the work of the Board.

Business Mapping: A mapping exercise sets the framework that the business will use to embed the Duty. This scoping exercise should cover the whole set of requirements within the Duty.


The Four Outcomes: Separated out, the implementation plan should make the high-level requirements of each outcome clear, and then provide action points, identifying the products and processes that need to be amended or introduced, how reviews will take place, and explain how monitoring will take place.


Implementation plans should also consider the customer journey from start to finish; this aspect is likely to be rather more involved than it might first appear. It is critical that the customer base is very well understood at the outset; without clear definitions here, it will be almost impossible to build the remainder of the firm’s response to the Duty.

In preparing the plans, we need to make sure that they are sufficiently detailed as to be of practical use, especially given that the Duty is very new, and departments must be able to understand what’s involved, what the FCA hopes to achieve, and which individual parameters need to be met.


Plans should also reflect how seriously the Board are taking the Duty. They should be comprehensive and must actively reflect the challenges that are currently facing the firm and are likely to arise via the Duty, and be transparent in how they will be mitigated and then monitored. In building up the plan, it is a good idea to act on the assumption that they will be asked to share the plans with the Regulator.


In the nine months remaining, there is a huge amount of work to be done. Laying the groundwork properly and hitting the timetable will help to get your firm off to the right start. The implementation plan is the first step; it must be detailed, reflect the importance of the Duty to the firm, and be of instructional use to the firm. We have created a Consumer Duty: Implementation Plan template to help firms get their planning off the ground.



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