YOUR COMPLIANCE MATTERS – Consumer Duty – Board Champions

Relevance: All firms

Action required: Review your own performance against the Consumer Duty requirements and decide whether you wish to retain the ‘Board Champion’ role.


In the latest ‘Regulation round-up,’ the FCA confirmed that it no longer expects firms to have a Consumer Duty Board Champion.

FCA statement

‘Now the Duty is in full effect, we want to give firms greater flexibility on their ongoing governance arrangements. Firms are free to retain the role should they wish to do so.

This means that the view set out in our final non-handbook guidance (FG 22/5), where we said we expected firms to have a champion at Board level or equivalent, no longer applies. We will take steps to update FG22/5 to reflect the new position in due course.

We want firms’ Boards and senior management to make good outcomes for consumers central to their firm’s culture, strategy, and business objectives.

In FG22/5, we said that we expect firms to have a champion at Board (or equivalent governing body) level to support the Chair and CEO in raising the Duty regularly in all relevant discussions, and challenging the firm’s governing body/management on how it is embedding the Duty and focusing on consumer outcomes.

The Duty came into force for open products and services on 31 July 2023, and for closed products and services on 31 July 2024. It should therefore be well-embedded in firms’ management discussions, processes, and policies.’

‘… from 27 February 2025 we no longer expect (Firms) to have a Duty champion, although they can retain the role should they wish to do so.

Our rules require firms to ensure that their obligations under the Duty are reflected in their strategies, governance, leadership, and people policies, including incentives at all levels. Firms also need to ensure that retail customer outcomes remain central to the firm’s risk control arrangements and internal audit function.’

Expectations

This does not represent a reduction in focus on the Consumer Duty Principle that requires firms to act to deliver good outcomes for retail customers.

The change does reflect the FCA expectation that firms will have embedded the requirements into the business to the point where collective responsibility is in place, and all firms are monitoring their performance through effective MI and review processes.

Be aware that the Consumer Duty drives much of the FCA supervisory work, and any loss of focus would be inappropriate.