The Financial Conduct Authority (FCA) has committed to being a more innovative, assertive and adaptive regulator, as it publishes its Business Plan for 2021/22.

In the first plan since Nikhil Rathi joined as chief executive, the FCA set out its key areas of focus for the coming year.

These included improving the standards of pension advice, strengthening rules on financial promotions to protect consumers in relation to investments, and a consumer campaign on scams and high-risk investments.

It will also focus on continuing to support the ‘smooth transition’ away from sterling LIBOR to alternative risk-free rates, alongside using the FCA’s authority and influence to work with its partners in driving down the frequency and impact of fraud.

The regulator also committed to improving diversity and inclusion, both at the FCA and in regulated firms, and to supporting environmental goals by adapting the regulatory framework to enable a ‘market-based transition’ to net-zero emissions.

Furthermore, the FCA revealed that it will begin a review of the scope and coverage of Financial Service Compensation Scheme payouts for specific regulated activities.

It is also considering opening an office in Leeds with at least 100 staff, and “establishing a presence” in Belfast and Cardiff.

“The FCA must continue to become a forward-looking, proactive regulator,” commented Rathi. “One that is tough, assertive, confident, decisive, agile.

“One that acts, acts fast—and where we can’t act, engages enthusiastically with those who can.

“Over the next 18 months you will continue to see an FCA that looks and feels even more different. One that operates differently, partners differently, and communicates differently.

“One that delivers market integrity and delivers for the consumers that we serve. One that is not only purposeful but that is fit for purpose.

“There is a lot of work to do. And I am confident that we have the right strategy, the right people and the right ambition to do it.”

Commenting on the plan, Gowling WLG partner and head of UK financial services regulatory team, Ian Mason, said: "This is a strong post-Covid response by the FCA. The FCA is re-inventing itself under the new senior management team.

"There is an increased emphasis on technology, innovation and the use of data. Also a stronger emphasis on protecting consumers, especially the vulnerable ones. Firms can expect the FCA to be more assertive, proactive and interventionist.

"The FCA will be a stronger gate-keeper on authorising firms, and tougher and more robust in using its supervision and enforcement powers. In particular it will be interesting to see how that statement the FCA will be 'testing the limits of our powers' plays out in practice. Diversity and inclusion also higher up the FCA's agenda, and the FCA expects firms to do more on this."

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