The Training Environment For Financial Services

Managing Conduct Risk under the FCA

09 Oct 2019, London

9:30am to 4:30pm

Outline & Objectives

Business conduct is in a bright and unforgiving spotlight. Although much has been said about Conduct Risk from the regulatory perspective, less has been done to help firms address the issue coherently. In the absence of anything prescriptive from the FCA, firms need to define what conduct risk means for their business and determine how to take positive action to address this risk. While the primary driver for seeking the effective management of conduct risk is to secure commercial success, there are additional pressures stemming from the ever higher standards being demanded by regulators, both nationally and internationally.

This workshop will address the issues firms need to take into account in order to manage and mitigate conduct risk. It will highlight the key themes in current thinking and provide practical pointers to help delegates ensure their firms’ approaches and arrangements are as effective as possible.

Specifically, attending will help you:

  1. Define the “conduct risks” in your business
  2. Understand the FCA’s approach to conduct risk
  3. Determine what fairness delivers for customers and how to apply the fairness agenda across the business
  4. Examine the tangible elements of conduct risk: product design, distribution and organisational infrastructure
  5. Implement techniques to manage the behavioural aspects of conduct risk
  6. Identify the steps to managing and monitoring conduct risk, including the role of the individual accountability regime
  7. Embed the mitigation of conduct risk into the culture and strategy of your organisation

Who will benefit?

This workshop is aimed at directors and other senior staff involved in establishing and embedding their firm’s culture and in managing the business compliantly. It will also be relevant to Risk and Compliance specialists, along with those responsible for board level oversight of the control functions. This event is equally appropraite for staff for firms which are either solo regulated (FCA) or dual regulated (PRA and FCA).

 

Course Presenter: Charles Cattell

Charles Cattell is a consultant and training practitioner with extensive expertise across the financial services sector. He advises, trains and develops a broad range of financial services clients and their senior managers about the human aspects of regulation with a particular focus on managing people risk, the development of competence and expertise and the enhancement of corporate culture. His clients include banks, product providers, intermediary firms, and insurers with whom he works at a senior level on learning, leadership, regulatory and corporate governance issues. Charles also works extensively with trade associations, examining bodies and regulators, whom he has advised on competence and professionalism issues. He is a Chartered Fellow of the Chartered Institute of Personnel and Development, a Chartered Member of the Chartered Institute for Securities & Investment and a Chartered Insurance Practitioner and an Associate of the Chartered Insurance Institute.

Course Programme

Session Content
Introducing “conduct risk”
  • Defining conduct risk
  • The parameters of conduct risk
  • The core focus of delivering client and customer expectation
The regulatory framework and approach to conduct risk
  • Risk-based regulation (principles vs rules)
  • Getting the business to “do the right thing”
  • Exercising judgement responsibly
  • Supervision and enforcement in relation to conduct risk
  • Key conduct questions
INHERENT CONDUCT RISKS  
Business models and governance of conduct risk
  • Conduct risk in a firm
  • Stress testing and managing contingencies
  • Orderly closure and wind-up
  • Financial crime
  • Cyber risk
Conduct risk, fairness and “Treating Customers Fairly”
  • Delivering on promises and rebuilding trust
  • Fairness as the start point for conduct risk mitigation
  • Clarifying what fairness delviers for customers
  • Applying the broader fairness agenda across the business
Tangible elements of conduct risk: product design, distribution and organisational infrastructure
  • Customer needs and risk exposures across the product life-cycle
  • Product governance and suitability
  • Matching product design to target markets
  • Addressing conduct risk issues during and after sales
  • Securing understanding about the needs and expectations of end users throughout the distribution chain
  • Building conduct risk into service level agreements
INDIVIDUAL RESPONSIBILITY FOR MANAGING CONDUCT  
Conduct risk and individual accountability
  • Embedding the Conduct Rules throughout the firm
  • Senior management accountability
  • Conduct risk and the certification of fitness and propriety
  • Referencing and discipline under SMCR
  • Mitigating people risk
SUPPORT TO IMPROVE BUSINESS CONDUCT
 
Practical aspects of managing and monitoring conduct risk
  • Applying a conduct risk framework
  • Conduct risk indicators and measures
  • Lines of defence
OVERSIGHT OF BUSINESS CONDUCT AND THE CONDUCT IMPLICATIONS OF STRATEGIC DECISIONS  
Behavioural aspects of conduct risk: leadership, conflicts of interest, people risk and organisational culture
  • Governance good practice
  • Recognising, highlighting and escalating problems
  • Conduct risk, leadership and supervision
  • Securing competence, capability and expertise
  • Developing a culture which mitigates conduct risk
ACTIVITIES THAT COULD UNDERMINE CONDUCT IMPROVEMENT STRATEGIES
  • Action planning

 

This course can be delivered in-house at a time and location to suit your business and tailored to suit your people and organisation. We can also create bespoke training when something very specific is needed.Please contact us to discuss your requirements in more detail and at no obligation.

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