At FTRC's Empowering Advice Through Technology event in Kings Cross last week (January 26), Ben Wright drew attention to the Financial Conduct Authority's criticism that many firms' consumer duty implementation plans are too "high level".
Earlier last week (January 27), the FCA published a multi-firm review drawing on plans put together by 60 large firms ahead of the July 31, 2023, consumer duty implementation deadline.
I'm willing to bet that at least one part of your implementation plan won't work.Ben Wright, Change Squared
The City watchdog said while there was evidence of good practice, too many firms included little explanation of tangible action, relied on repackaged data, struggled with poor prioritisation such as "unclear" timelines, and was complacent about past improvements.
Addressing the volume of "high level" plans across the industry, Wright said: "This feedback isn't surprising because firms had to put these plans together quite quickly. But the problem with high level is that practically, not everything works.
"You'll think 'yeah that's a great idea, it'll be fine, let's just get on with it'. But when you come down to actually try and do that in reality, I'm willing to bet that at least one part of your implementation plan won't work.
"My top tip would be, have a go now. If you said you're going to do something, then try it. Because you might find out it doesn't work. If you do it now, you've got six months to flip things around and make changes.
"Whereas if you put your plan into action two weeks before consumer duty and it doesn't work, that's not going to be great."
Advisers have only got three and a half months to consider fair value, make an assessment, and then make changes.Dawn Mealing, Fidelity Wealth Management
Dawn Mealing, head of advice policy and proposition at Fidelity Wealth Management, was also on the panel.
She re-iterated the lack of time firms have now to get things right and told advisers to think about the deadlines.
"The challenge for IFAs is that they all have to do it by end of July. Manufacturers have deadlines in April and July. IFAs have to take into account prices for both their services and those of manufacturers to calculate fair value," said Mealing.
"That means advisers have only got three and a half months to consider fair value, make an assessment, and then make changes.
"And I bet your bottom dollar most providers won’t be ready until the end of April."