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Eight lessons from the Senior Managers and Certification Regime Stocktake

In August 2019 the Financial Conduct Authority published a stocktake report of the embedding of the SMCR in banks since it was first introduced in 2016. Insurance companies are in their first year of the SMCR and all other regulated firms will be subject to the regime from December 2019. ICAEW’s Financial Services Faculty highlights 8 lessons from the review accompanied by a range of resources for tackling the challenges it presents.

Culture needs to stay at the top of the agenda and be considered proactively rather than in response to crises like the LIBOR rigging scandal or PPI. Businesses need to understand how changes can be assessed and measured when change is primarily made to controls and processes. The FCA is looking a stronger tone at the top and an emphasis on a “speak up” culture. ICAEW’s report How whistleblowing helps companies looks at how to empower employees to speak up.

Individuals and firms would like more clarity here, but the FCA feels more guidance is not the answer and will not be more prescriptive. Firms should focus on: