Regulatory priorities for 2023

As 2022 comes to an end, all our readers are probably thinking more about the imminent festivities and looking forward to a well earned break from what has undoubtedly been a difficult year in several obvious respects.


We at ATEB are also looking forward to a few days off. However, without wishing to spoil the Christmas atmosphere, we felt it would be helpful to summarise what is on the FCA radar for the coming year.

The FCA’s immediate current focus was summarised in a speech delivered by Therese Chambers, the FCA’s Director of Consumer Investments, at the Festival of Financial Planning, held in Birmingham.  She recently addressed the audience regarding the FCA’s key priorities for the financial advice industry.

We have written in more detail about some of these topics recently, for example Consumer Duty, and you might wish to browse previous articles when you have a spare moment – but preferably not until 2023!

From ATEB (and other articles) on Consumer Duty, firms should have a reasonable grasp of the rules that will apply in order to meet the following three ‘obligations’ –

  1. A firm must act in good faith towards retail customers.
  2. A firm must avoid causing foreseeable harm to retail customers.
  3. A firm must enable and support retail customers to pursue their financial objectives.

However it’s more than just rules! While it is important that firms meet the requirements, firms will need to embrace cultural change. In her speech, Therese Chambers emphasised that “… cultural change cannot be achieved simply by adjustments in governance, MI, and processes. Yes, these can support cultural change, but firms’ senior management need to clearly demonstrate to the rest of their colleagues throughout their firm what putting good consumer outcomes at the heart of their business means. Firms which view the new Consumer Duty as simply a change to governance and processes are doomed to fail from the start.”

The desired outcome of all this is that the FCA wants “to see more consumers who can afford to do so investing their money safely”. The Regulator warns that “this will only occur in a better consumer investment market”. Of particular note is the comment that “Financial advisers play a major role in helping or hindering this better market.”

Consumer Duty is clearly intended to ensure that advisers help rather than hinder the desired ‘better market’.

Last but not least …

Otherwise, the FCA has set out many areas of focus in its Business Plan for 22/23 and the May 2022 Regulatory Initiatives Grid – both of which are worth a look. Main items of likely interest and relevance to our readers include:

  • ESG – a raft of new requirements around ;sustainable finance is already nearing launch. Not much immediately affects advisers but watch this space
  • Appointed Representatives – new rules have recently been put in place to firm up how ARs’ and Principal firms are supervised
  • Resilience – the FCA is concerned to ensure that firms are resilient both operationally and financially

Important Note: ATEB news is intended to provide general information ONLY. The content, including any views expressed or guidance provided, does not replace the need to comply fully with FCA Rules and Guidance. Unless you have discussed news article content with ATEB, and specifically how it relates to your circumstances, then ATEB disclaims all liability and responsibility and actions arising from any reliance placed upon it. For the avoidance of doubt therefore, any reliance you place on such information without our consultation is at your own risk.

ATEB Compliance offers compliance and regulatory advice.

ATEB Suitability provides report writing software for the financial services market.

Our View

Over the years we have tried to use the imminent year end to paint a picture of what might be coming over the regulatory horizon and that is what this article is intended to do. That is a little more difficult this year because of the likelihood that many current rules, particularly those arising out of MiFIDII, may well be amended or scrapped altogether in line with the Government’s stated desire to move away EU driven rules that are considered not to support UK Financial Services very well. We have already seen some early signs with costs disclosure requirements likely to be significantly eased and amended. As some of the MiFIDII rules were undoubtedly better in theory than in practice, we will welcome any review that results in more practical rules.

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For information. Have a lovely Christmas!
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About the Author

Lisa has a wide range of skills and knowledge, and a track record of implementing compliance and T&C systems and processes of the highest calibre, covering all aspects of financial services.

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