Asset manager Abrdn has developed materials to help advisers prepare for the Financial Conduct Authority’s (FCA) new Consumer Duty rules.
The materials include step-by-step guides to help advisers prepare for the four key outcomes outlined under the new rules.
The new duty is one of the biggest overhauls to UK financial regulation since the Retail Distribution Review.
It will introduce a sweeping new set of rules which will require firms to do more to protect consumers from harm and bad financial decisions.
From July 2023, firms will be required to do everything possible to avoid “consumer harm” at every step of the customer journey.
The new rules are focused on the provision of value to consumers and evidencing it.
Under the new rules, which will come into force in July 2023, Financial Planning firms will be required to:
- Act in good faith towards retail customers
- Avoid foreseeable harm to retail customers
- Enable and support retail customers to pursue their financial objectives
Under the Duty Financial Planning firms will have to provide consumers with information they can understand, offer products and services that are fit for purpose, and provide helpful customer service.
Firms will also have to evidence what they are doing to meet the Duty.
Alastair Black, head of industry change at Abrdn, said whilst many advice firms will already be delivering on most aspects of the new rules steps still need to be taken to get everything in order.
He said: “Good client outcomes are already wired into adviser firms’ day-to-day operations. Many will already be delivering on what the Consumer Duty aims to achieve by virtue of existing regulatory alignment and the processes that are needed to give ‘good’, suitable client-specific advice. It’s why I’m confident that compliance won’t mean a radical overhaul of systems and procedures for the majority of firms. However, there are still steps that need to be taken, and advisers may need support getting everything in order.
“Taking prompt action now to review the rules against their existing systems and processes will pay dividends in understanding what is needed, with an implementation plan that has to be approved by the end of October, to ensure everything can be done by the end of July 2023.”
The fund manager has launched a Consumer Duty hub to host the content for advisers online. It can be found here.
