The City regulator, the Financial Conduct Authority (FCA), has published its business plan for the 2024/25 tax year.

The plan is a chance for professionals working in and around financial services to gain key insights into the regulator’s thinking and planned areas of focus for the year ahead.

This year’s business plan reaffirms a three-year project which focuses on the delivery of Consumer Duty.

What is Consumer Duty?

Consumer Duty is a landmark set of standards introduced by the regulator to improve general consumer protections in financial services.

In its own words it requires firms “to act to deliver good outcomes for retail customers”.

Consumer Duty came into force on 31 July 2023. So, many firms are still adjusting to the end implications for how they serve customers.

Nikhil Rathi, Chief Executive of the FCA, comments: “We’ve already made significant progress in delivering against the bold vision we set out in our strategy two years ago, including the game-changing introduction of the Consumer Duty and proposing the most far-reaching reforms to wholesale market regulation and the listing regime in decades.

“We remain resolute in supporting the vital role the financial sector plays in the UK’s long-term economic growth, embracing the potential benefits that technology presents both for us and the firms we regulate, while also continuing to protect consumers and ensure market integrity.”

FCA business plan 2024/25

So, where does the new business plan come in? The FCA has used this year’s business plan to reaffirm its commitment to continually test firms on their adherence to Consumer Duty principles and has reminded firms that it isn’t a case of ‘do it once and you’re done’.

The regulator says it is building a data-led approach to this to weed out firms that aren’t meeting the standards it now sets. In its press communication it describes its approach as “assertive” – a clear warning to companies dragging their feet.

What is really important here is ensuring your business is fully compliant with the wording, and spirit, of Consumer Duty. The standards have specific individual accountability clauses (Individual Conduct Rule 6) which target senior management and executives to ensure accountability.

Legal and professional accountancy firms are both impacted by the standards. For that reason, it is important to ensure you are meeting the required level of compliance. Working with a regulated advice business which has deep resources and experience in compliance matters is essential in this regard.

Ultimately, Consumer Duty isn’t going to be a one-off welfare check to ensure your business is doing the ‘right thing’. It will be an ongoing process of ensuring every aspect of your work is geared toward meeting the needs of the end consumer. Ensuring ongoing compliance, and being able to produce evidence of that compliance, is critical.