The Financial Conduct Authority (FCA) requires all authorised firms, individuals and other
bodies to continuously monitor their consumer outcomes. Your Board should approve a
report on your consumer outcomes for publication at least once annually.
This further reporting obligation may seem daunting. However, it is essential not only for
compliance with the FCA’s Consumer Duty, but also for demonstrating to your clients that
you’re passionate about offering them the best possible service. Here are some easy tips for
fine-tuning your outcomes testing before submitting your consumer outcomes report to your
Board for approval.
- Does your assessment of consumer outcomes cover the whole customer journey? A
pleasant telephone manner is amazing but won’t compensate for failing to deliver
value for money for your clients.
- Is testing providing you with the most precise data possible?
- What is your capacity for outcomes testing? How and over what time frame could this
be increased?
- Are the metrics you’re using in testing outcomes focused? Make sure they measure
your achievements for clients rather than your own inputs such as time spent on
various projects.
- Are you taking actions based on the results of your testing? Pushing bad news under
a drawer somewhere won’t impress your clients or the FCA.
- Are you adequately monitoring and reporting the root causes of any poor outcomes
and your actions in response?
- Have you created a forum within your team for colleagues to challenge and innovate
practices which are no longer optimally delivering, monitoring or reporting client
outcomes?
The FCA expects your Board to assess whether the outcomes your firm has
delivered comply with the Duty. They also expect the Board to fully discuss evidence
of any poor outcomes and review actions taken to address and eradicate their root
causes. The Board should also assess any risks emanating from poor outcomes and
minimise these risks’ negative impact on the firm. Poor outcomes are not limited to
incidences of poor service and results on individual accounts, but also cover
incidents where one group may be receiving preferential or inferior treatment to
another. The FCA also expects the Board to design the firm’s future growth strategy
to comply with the Duty. All this should be noted in the draft of your report which is
finally published
Every Board is different and the FCA understands this perfectly. Their expectation is
that all firms do everything in their power to deliver good outcomes for their clients.
Your firm’s Consumer Duty Board Champion should take the lead in preparing the
Board to manage any challenges posed by the consumer outcomes report you
submit to the Boad for approval. It may well be that all of the matters mentioned
above cannot be adequately addressed as an agenda item in one meeting. Your
Board may well require various sub-committees to ensure that your firm reviews any
poor outcomes or recommended improvements to your outcomes testing. Most
importantly of all, allow sufficient time to demonstrate to the FCA that you have
placed compliance with both the wording and the spirit of their Consumer Duty at the
heart of your firm’s annual report.
The Vetted Adviser team is here to give you easy access to a whole range of
insightful data points for measuring your consumer outcomes. The better your access
to data, the more detailed, accurate and impressive your reporting will be.
What does the FCA’s Final Guidance say about Consumer Outcome Reports?
The FCA’s Final Guidance on the Consumer Duty requires all Boards to “review and approve
the Firm’s assessment of whether it is delivering good outcomes for its customers which are
consistent with the Duty and agree any action required, at least annually.” The Consumer
Duty Final Guidance FG22/5 provides particularly helpful guidance for Boards on reviewing
consumer outcomes prior to reporting on them in sections 6.80, 7.51 and 10.15.
- General
