Ed Smith interview on Consumer Duty outcomes monitoring

The Financial Conduct Authority (FCA) has published the transcript of another podcast relating to the new consumer duty. Specifically, this time the transcript includes an interview with the FCA’s Head of Competition Policy, Ed Smith, concerning the „outcome monitoring“ of firms in accordance with the new duty. „Outcome monitoring“ thereby refers to the follow-up that needs to be performed by firms in order to ensure that the products or services offered to clients meet the four objectives of the consumer duty, namely:
1. communications: firms must ensure that consumers get all the information they need to make informed decisions.
2. products and services: firms must ensure that their products are designed in a way that ensures that they meet the needs of consumers and that – in turn – they are only sold to those customers whose needs they are intended to meet.
3. customer service: firms must ensure that their levels of customer service meet the need of consumers and that such service does not hinder clients from achieving their desired outcomes.
4. price and value: firms must ensure that the products offered to retail customers are priced at fair value.
In the podcast now, Mr. Smith describes, among other things,
– what is meant by „outcome monitoring“ from the regulator’s point of view;
– the reasoning behind this required activity;
– the expectations of the FCA if the monitoring shows that customers are not getting „good outcomes“;
– the documents that shall be gathered by firms in the process of „outcome monitoring“ and to evidence „good outcomes“;
– how the monitoring is to be performed, for example, when a firm has no direct interaction with the retail customer;
– the FCA’s expectations as regards the governance rules, strategies, and structures that shall be in place concerning „outcome monitoring“; or
– the FCA’s expectations as regards the frequency of „outcome monitoring“.
—
As these are only the key issues around „outcome monitoring“ discussed in the podcast, please refer to the transcript or the original audio file for more detailed, comprehensive information.