On 7 April 2020, the FCA published its Business Plan for 2020/21. The document is perhaps shorter and higher-level than seen in the past, but this also has to be set against the context of the evolving impact of Coronavirus and the difficulties and uncertainties this is creating. Indeed, the FCA recognises it may need to update the plan if necessary depending on how the situation develops.

Taking the key parts in turn, the latest Business Plan includes the following:

Key FCA priorities over next 1-3 years

The FCA has identified five key areas. The first is transforming how it works and regulates, and the four external ones are:

  • Enabling effective consumer investment decisions
  • Ensuring consumer credit markets work well
  • Making payments safe and accessible
  • Delivering fair value in a digital age

Cross cutting work

Here, the FCA notes five key priorities that have a broad market impact:

  • EU withdrawal and wider international work
  • Climate change
  • Innovation and technology
  • Operational resilience
  • Financial crime
  • Culture

Sector work

The sectors covered in this section include wholesale financial markets, investment management, retail banking and general insurance and protection.

Key outcomes in wholesale markets

  • Orderly transition from LIBOR. With regards to the date, it is worth noting that the FCA states that  “it is important that firms transition before the prospective end of LIBOR after the end of 2021 and treat customers fairly”
  • Clean markets that make it difficult to commit market abuse and financial crime
  • Wholesale markets that deliver a range of good value, high-quality products and services to market participants, remain orderly in a range of market conditions and meet users’ needs

Key outcomes in investment management

  • Investors get high-quality, fair value, products and services.
  • Effective governance including expecting firms to implement the SM&CR properly
  • Ensuring asset managers properly manage exposure to LIBOR risk, including conduct risks

Key outcomes in retail banking

  • The sector is operationally resilient
  • The incidence of fraud and financial crime including fraud is minimised
  • Consumers and SMEs can access services that meet their needs, including cash
  • Customers get high-quality products and services from retail banks

Key outcomes in general insurance & protection

  • Customers take out products and services that are suitable for their needs and deliver on their promises at the time of claim.
  • Customers are not unfairly excluded from products and services
  • The sector is operationally resilient

So what does this all mean, and what should firms be thinking about?

As the Coronavirus pandemic develops, there are clearly a myriad of challenges to deal with. To help navigate through these, from a holistic standpoint, over the coming period firms should keep their processes under regular review. Whilst fair customer treatment is of course paramount, firms will need to both flex their systems and ensure they are consistent, for example:

  • having clear and consistent regular governance meetings and discussions as the crisis develops – ensuring that retail customer outcomes are fed through in management information and reporting;
  • regularly reviewing response plans so that customer feedback and evolving areas of focus can be factored in;
  • ensuring a consistent protocol is in place (with appropriate guidance) for evidencing key decisions on customer outcomes and how and when to escalate matters. This is particularly important in terms of accountability regimes such as the SM&CR;
  • being clear, regular, consistent and joined-up with public and customer communications; and
  • keeping “fairness” under review, for example not recovering when it is actually in the customer’s best interests could create unfair outcomes and detriment over time.