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The Financial Conduct Authority’s (FCA) Consumer Duty requires all financial services firms to consistently deliver good customer outcomes. 2024 marks two key deadlines for the Consumer Duty, as well as the first full year of operation for open-book products.


The Annual Board Report and when is it due?

Firms must submit their first annual Consumer Duty board report by July 31st, 2024. 

This report, a key pillar of the FCA's new regulations, requires firms to demonstrate how they are delivering good customer outcomes.  Firms must go beyond traditional metrics and evidence that their products and services meet customer needs, avoid harm, and offer fair value. The board (or equivalent governing body) is required to review and approve this assessment at least annually.

Before signing off the assessment, the board (or equivalent governing body) should agree the action(s) required to address any identified risks, or any action(s) required to address poor outcomes experienced by customers and agree whether any changes to the firm’s future business strategy are required.

This report is a chance for firms to showcase their commitment to putting consumers first and navigate the evolving regulatory landscape.


When does the Consumer Duty come into effect for closed-book products?

The 31 July 2024 marks not only the first annual Consumer Duty board report, but also the critical closed-book deadline. All closed-book products and services must be assessed for compliance with the Consumer Duty by then. Firms with closed-book products should therefore ensure they are reviewed for fair value, prevention of harm, and meeting customer needs.

This is a crucial step in demonstrating a holistic commitment to consumer well-being under the FCA's new regulations, as well as demonstrating compliance with the new rules.


What about ongoing requirements for open-book products?

Beyond the initial deadlines of 31 July 2024, the Consumer Duty establishes ongoing requirements for firms. The FCA expects ongoing focus and continuous improvement – the work will never truly be finished.

Here's what firms should be thinking about throughout 2024:

Continuous outcome testing

Firms must establish a framework for regularly testing the actual outcomes customers experience throughout their customer journeys. This includes using data and customer feedback to assess if products and services deliver fair value, prevent harm, and meet customer needs.

Governance, people, and culture

The Consumer Duty isn't a siloed exercise. Firms must integrate its principles into all aspects of their business, from product design and sales practices to customer service and complaint handling. This requires ongoing training and cultural change to ensure all staff understand and act in accordance with the Duty. The rules require firms to ensure their strategies, governance, leadership, and people policies (including incentives at all levels) lead to good outcomes for customers. The rules also make clear that customer outcomes should be a key lens for areas such as Risk and Internal Audit.

Embedding the Duty throughout the organisation, and regular reporting and monitoring

The ability to identify the extent to which good outcomes are being achieved is arguably the most significant challenge posed by the Consumer Duty. MI in this respect both drives and demonstrates the embedding of the Duty. The FCA expects that firms’ approaches will mature and evolve over time and we should expect ongoing reporting requirements to the FCA. Firms will need to demonstrate how they're embedding the Duty, addressing identified issues, and utilising outcome testing results to improve customer experiences.


The Consumer Duty is a significant shift towards a more outcome-oriented approach to regulation. Firms that embrace continuous monitoring, data-driven decision making and a customer-centric culture will be well-positioned to succeed under these ongoing requirements.

Why Grant Thornton

Grant Thornton can be your partner in navigating the complexities of the Consumer Duty. Our deep regulatory expertise and proven track record can help you ensure closed-book products comply by the July deadline and guide you through the annual board report, demonstrating your commitment to good customer outcomes. Furthermore, our ongoing support can ensure your open-book products remain compliant with the Duty's evolving requirements, including outcome testing.

The level and nature of advice and support we can provide is entirely flexible. Skilled resource is available as and when required to deliver any aspect of your programme of work.


FCA Business Plan 2024/25

The Financial Conduct Authority has published its Business Plan for 2024/25. Paul Staples explains what it means for firms and highlights the regulator’s key priorities for the coming year.

“The Consumer Duty came into force for open products and services on 31 July 2023. We welcome the improvements made by many firms to deliver better outcomes for their customers. However, some firms are lagging behind.

Under the Duty, firms must act to deliver good outcomes for retail customers. Firms should aim to continuously address issues that risk causing consumer harm.”

Financial Conduct Authority
Consumer Duty implementation: good practice and areas for improvement (February 2024)

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