Eight considerations non-executive directors should ask their boards about Consumer Duty Management Information.

As a NED, you should be aware that the UK’s Financial Conduct Authority (FCA) Consumer Duty is designed to ensure that financial services firms provide higher consumer protection. To evidence compliance with the Consumer Duty, firms should consider a range of Management Information (MI) metrics.

You should challenge your board around consumer duty, and you may want to consider these eight metric themes:

1. Customer Understanding: Metrics that show the firm understands its target market and customer needs. This could involve data on customer feedback, market research outcomes, and complaints analysis.
2. Product and Service Suitability: Data demonstrating that products and services are designed to meet the needs of identified customer groups. This might include information on product usage, suitability assessments, and product performance relative to customer expectations.
3. Fair Value Assessment: Information evidencing that customers receive fair value, which could involve pricing analysis, comparisons to market benchmarks, and data on fees and charges.
4. Customer Outcomes: Metrics that track the actual outcomes experienced by customers, such as satisfaction scores, fulfillment of product promises, and the incidence of customer harm or complaints.
5. Communication Clarity and Effectiveness: Evidence that communications with customers are clear, fair, and not misleading. This may include results from customer comprehension tests, feedback on clarity of information, and data on customer queries or misunderstandings.
6. Customer Service and Support: Information on the effectiveness and accessibility of customer support, including response times, resolution rates, and customer feedback on support experiences.
7. Governance and Oversight: Data showing effective governance around the Consumer Duty, such as records of internal audits, training compliance, and decision-making processes.
8. Risk Management: Metrics related to the identification, assessment, and management of risks to customers, ensuring that risks are minimized and managed effectively.

Final thoughts

Firms should ensure that these metrics are regularly monitored, and that the MI is used to inform continuous improvements in line with the Consumer Duty objectives.

Disclaimer: The information provided herein is solely for informational purposes and represents my own personal views. It should not be construed as legal or regulatory advice. For advice specific to your circumstances, please consult a qualified professional. Additionally, the opinions expressed are my own and do not reflect the views of my employer.