In deep water: High Court decides on level of compensation for interference with fishing quotas
As far as end of term reports go the Financial Conduct Authority is pleased to give itself a pat on the back as it believes confidence in it as a regulator continues to improve.
In the Annual Report and Accounts 2016/17 laid before Parliament on 5 July 2017 the FCA reflects on its performance in delivering on its overarching strategic objective of ensuring that financial markets work well, alongside its statutory objective of: securing an appropriate degree of protection for consumers; protecting and enhancing the integrity of the UK financial system; and, promoting effective competition in the interests of consumers.
Outgoing Chairman John Griffiths confirms that “given the scale and importance of the sector in the UK our role is one we must perform well.” Indeed the report sets out the wide remit of the FCA recalling that it covers 56,000 firms ranging from asset managers and banks to financial advisors and consumer credit providers. The FCA regulates over 140,000 regulated persons working in the industry and the UK’s financial markets.
We are reminded that financial services contribute around 12% of the UK’s total economic output “directly affecting the strength of our economy and attracting international investment”.
The strength of the economy and the need to respond flexibly to external events – principally BREXIT – is central to CEO Andrew Bailey’s account of the year. He gave a follow up speech on this on 6 July 2017.
The report underlines that the single most important achievement has been to embed the importance of good conduct at the core of the UK’s financial sector. The launch of the Senior Managers and Certification Regime in banking and insurance (March 2016 – see more) was critical to this. Indeed, we wait for the next phase of this with the imminent extension to all other regulated firms – a consultation is due on this any moment now.
The report concludes that the financial services sector has largely realised that “our agenda needs to be a core part of its own” and that change in behaviour is in a large part due to the firms’ efforts to improve their business models and culture to meet the FCA’s expectations. It states that “regulatory arbitrage, at least in the conduct arena, is a game no longer worth playing” and that the pendulum of regulation must not be allowed to swing back. The focus of firms “must remain firmly on the conduct ball”.
The FCA report confirms that the best form of regulation is preventative - with John Griffiths referring to this as “constructive deterrence”. That said the FCA will, and has taken action where consumers have suffered harm. Highlight for 2016/17 in this regard are cited as:
The FCA concludes that “in our judgment we have acted compatibly with our strategic objective and advanced our operational objectives over the course of the year”.
Skip to content Home About Us Insights Services Contact Accessibility