It is telling that, despite the constant regulatory change we all face, firms are still being fined for what should be the basics of our industry: know your customer, suitability, and complaints handling.
When fully implemented, the SMCR should achieve many of the same objectives of a new duty.
The FCA views the SMCR as a key tool in driving culture and governance improvements, driving better outcomes for consumers and placing obligations on both individuals and firms.
For individuals, the conduct rules set out minimum standards of behaviour, including paying due regard to the interests of consumers and treating them fairly.
Of utmost importance is the need for firms to ensure SMCR is effectively implemented and then maintained.
It must not become another new initiative which is rolled out with great fanfare but then quietly left to go out of date by firms and their supervisors.
One of the overarching messages of the FCA’s 2018/19 business plan was that it has finite resources, particularly in light of Brexit, and therefore needs to provide protection to those consumers who need it the most.
In our view, rather than introduce a new duty, it should prioritise interventions where it finds business practices that are exacerbating customer fairness issues, and where vulnerable customers are not being treated with appropriate levels of professionalism.
The introduction of any additional rules, guidance or duty on firms would risk introducing additional complexity and confusion into the regulatory regime, something the FCA has been working to tackle in recent times.
While there is much that FCA needs to do to improve itself, improvements in market stability and consumer protection must start with firms.
Mike Harrison is associate director of TCC