SMCR 

What you need to know about the Senior Managers and Certification Regime

Making individuals more accountable 

The Senior Managers and Certification Regime (SMCR) was extended to cover all FCA solo-regulated firms in December 2019. The overarching goal of the regime is to reduce harm to consumers and strengthen market integrity by making individuals more accountable for their conduct and competence.

This means firms must have identified and nominated individuals to formally perform their Senior Manager Roles. Once Senior Manager Roles have been established, firms must maintain up-to-date records of their responsibilities and performance. These individuals must also undergo an annual assessment to ensure their ‘fitness and propriety’.

Understanding how responsibilities and roles are divided among the Senior Managers of a firm is not just important for the Senior Managers themselves, who have personal liability, but for the firm as a whole.

Impact

While some firms are still grappling with the initial implications of SMCR and defining their roles and responsibilities, others are beginning to focus on the implementation of the ongoing monitoring and record keeping aspect, which remains an issue.

Increased scrutiny

Recent economic crises have only increased the scrutiny on how Senior Managers can evidence their steps to perform their duty and meet their conduct obligations. This includes understanding who the key workers in their team are, maintaining essential customer services, and ensuring appropriate product governance.

The FCA recently agreed to delay the regulatory deadline to demonstrate compliance with some SMCR requirements for those firms brought into scope by the December 2019 implementation.

Firms now have until March 31, 2021 (instead of December 9, 2020), to have completed their first fitness and propriety assessment and submitted their information about their Senior Managers. However, the FCA has made it clear it still expects firms to satisfy their regulatory responsibilities as soon as possible, stressing the risk in delaying assessments of individuals fitness and propriety.

SMCR Resources

Ensuring compliance with the SMCR regime continues to be a pressing issue for many firms

SteelEye reduces the complexity and cost of financial compliance and provides clients with a centralised data platform for monitoring and managing Senior Manager Responsibilities and Roles. SteelEye is also equipped with automatic triggers and alerts to remind firms to define new roles and to address the requirement for an ongoing annual assessment of fitness and propriety of each senior manager. Book a demo to learn more about how SteelEye can help you Comply Smarter™.

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