The Financial Conduct Authority has said it will try to reduce the impact of regulation on firms now it has changed its approach to its work.
It comes after the FCA’s advice panels warned of “regulatory overload” as an ongoing issue.
This warning was made by the independent panels which advice the FCA, including the Financial Services Consumer Panel, the Small Business Practitioner Panel and the main Practitioner Panel.
The Smaller Business Practitioner Panel challenged the number of data requests the FCA makes to firms and whether its cost benefit analyses for significant work could be more rigorous.
The panel’s concern was that regulation should be proportionate to the size of a firm and the risk it poses.
In response the FCA said: “We recognise that the volume of regulatory change can put pressure on firms’ resources.
“We have a thorough Business Planning process which prioritises our work according to where we can have the most impact.
“As we have moved to a more sector-based approach to our work, we now have better oversight of all individual projects covering each sector.
“So we will try to ensure that, as far as possible within our remit, we can reduce the cumulative impact of our regulatory requirements on firms.”
All of the panels identified Brexit as a major issue for financial services and said they were keen to work closely with the FCA in preparation for the UK’s departure from the European Union.
In response the FCA said it welcomed the input of the panels and would continue to work with them on this issue.
One of the areas identified as a “key work stream” for the FCA was financial advice, including the Financial Advice Market Review.
The Smaller Business Practitioner Panel welcomed the clarity created by the change to the regulated activity of advising on investments while the Consumer Panel stressed the importance of continued scrutiny of the robo-advice market.
damian.fantato@ft.com
