What does the extension of the SM&CR mean for your Firm?

The SM&CR, which currently applies to Banks, Building Societies, Credit Unions and Prudential Regulatory Authority (PRA) regulated Investment Firms, will be extended to all other Financial Conduct Authority (FCA) regulated firms on the 9th December 2019. The new framework will replace the current Approved Persons Regime (except for Appointed Representatives) and will focus on firms’ governance arrangements and accountability. The regime has been designed on the basis of proportionality where the requirements will apply differently to firms depending on the category the firm falls in.

Whether you are a Limited Scope; Core Firm; Enhanced Firm, EEA branch or Non-EEA Branch; the regime will force you to identify and allocate individuals who hold positions of responsibility.

The SM&CR has three facets:

  • Senior Manager’s Regime - replaces the current Significant Harm Functions
  • Certification Regime - a new licencing regime applying to employees who are not Senior Managers but who’s actions could cause significant harm to the firm or its clients.
  • Conduct Rules - a new set of Code of Conduct rules which will replace the current Statement of Principles and Code of Practice for Approved Persons and will apply to all employees except ancillary staff.

What do you need to do to comply with the SM&CR?

Each component of the regime will require you to undertake an in-depth analysis of your current organisational arrangements and assess how the new regime will impact your organisation. Although the FCA have published detailed guidance of how the SM&CR will need to be adopted by each firm, the responsibility of being ready and prepared for when the new regime comes into force lies with your Firm, and the solution can and will vary by firm.

How we can help you to achieve and maintain compliance with the SM&CR

We led numerous SM&CR implementation projects when the regime was first introduced in 2016 and continue to advise firms on the existing and forthcoming requirements. We are unique in that we can provide a holistic solution to help you achieve and maintain SM&CR compliance. We offer consultancy, training and CCL CORE, our compliance software solution to ensure ongoing compliance of SM&CR, enabling us to assist your Firm in the following ways.

Deploy our compliance platform, CCL CORE to help you:

  • Record and allocate Senior Management Functions and Prescribed Responsibilities
  • Register certified individuals within the firm and manage ongoing certification
  • Record, escalate, resolve and report on conduct rule breaches or incidents
  • Deliver an end to end compliance monitoring solution, including issue resolution
  • Automate firm-wide attestations, including fit SM&CR-specific attestations
  • Provide a real-time dashboard on the state of compliance within your organisation
  • Access our policy library for ongoing updates in light of regulatory change
  • Generate accurate and cost-efficient reporting to senior management

Rely on our consultants to help your Firm:

  • Understand how SM&CR will impact your business
  • Outline key actions and processes that are required by SM&CR
  • Project manage your SM&CR programme from design to implementation
  • Review your existing governance framework for enhancements
  • Define and create your Responsibilities Map
  • Update your policies and procedures to ensure compliance with SM&CR
  • Enhance management information design and distribution
  • Deliver training to all levels of staff within your business

We have a dedicated team of experienced compliance consultants who can provide expert assurance and peace of mind. Get in touch to see how we can help your Firm.