Following the Financial Conduct Authority’s Final non-Handbook Guidance last July, plans to implement its new consumer duty were finalised at the end of October 2022 and companies should now be moving towards the first implementation deadline of July 31 2023 for all new and existing products and services that are on sale.
The FCA reviewed companies’ plans in January and found that there was a risk that some businesses may not be ready by the implementation date. In particular, the regulator highlighted that attention should be focused on prioritising implementation work effectively to reduce the risk of poor consumer outcomes, embedding the requirements and working with other companies within the distribution chain.
The FCA has sent out various Dear CEO letters and published several inside FCA podcasts to assist companies with their implementation and work to ensure the duty is in place by July 31 continues.
Since then, in a speech on May 10 2023, FCA executive director of consumers and competition Sheldon Mills has commented that many companies are on course to meet the implementation deadline.
Implementation plan
While the FCA has not set out specific steps for implementation, the work needed to implement the duty within a company will vary depending on various factors, including the products it offers, its customers, the distribution chain, its FCA permissions and its existing practices.
Further, the outcomes-focused nature of the consumer duty means that it is not possible to prescribe a one-size-fits-all implementation plan. However, by way of a non-exhaustive list, work to implement the duty could have included the following:
