On 6 May 2021, the FCA published a speech by its chair, Charles Randell, entitled Outcomes-focused regulation: a measure of success?
Highlights in the speech include:
- Outcomes-focussed regulation has already had a measure of success at the FCA. In some really important markets the FCA is making a difference, to the benefit of millions of consumers. But a focus on defining and measuring outcomes and acting on the results is not yet sufficiently embedded in everything it does.
- One of the key strands of the FCA’s transformation programme is a data strategy which identifies data gaps in its everyday supervision of firms and markets and remedies those gaps, so that the FCA can turn data about outcomes into prompt, agile and more preventative action.
- Too often regulation is seen as a compliance or box-ticking exercise. If the FCA regulates with detailed inputs it can make it worse, as firms focus on the regulatory requirements rather than the outcomes. As the FCA develops its approach to regulation in the post-pandemic world, it needs to reset its expectations of how firms define the outcomes their customers can expect from their products and services and how they measure and demonstrate whether those products or services are producing those outcomes. The FCA will be consulting on a New Consumer Duty that could embed this approach shortly.