Consumer Duty

Whereas I know that I can leave that in James's capable hands.

And for things like consumer duty and client outcomes, it allows me to really demonstrate that there's consistency across all of the clients, that everybody is monitored and looked after the same.

I think that's a real key for me on what it looks like really.

Thank you.

So changing direction towards the consumer duty, which you briefly mentioned.

So this regulation has raised the bar for everyone, but it's also, like you've alluded to, added more complexity.

Dorian, in your experience, where are advisors finding it more challenging to demonstrate ongoing suitability and value? And where can a well-run NPS help?

They just want to know that their portfolio is looked after that their plan is on track to meet the objectives and the goals that they want to.

You know, it is getting more and more complex.

We've obviously seen standards raised across consumer duty, so not only are clients asking more from advisors, the regulator as well.

And I think, you know, there's a change that's coming up in 161 day working days time, which is those changes on the 6th of April, um, which are gonna add even further complexity.

So I think what you've gotta look for from platforms and the partners that advisors engage with is how do we sort of create the right capacity to enable advisors to still deliver the right outcomes for clients, um, by creating efficiencies, making sure that the platform is really easy to use, and that solutions are on there and they can be accessed really, really easy.

So the add- reality is that retirement planning has become much more complex.

Clients are living longer, retirement itself can last 30 years or more, and advisors are navigating, as Jamie alluded to, an ever-changing landscape of regulation, taxation, and then market uncertainty.

So against that backdrop, advisors want trusted partners who can help them deliver consistently good client outcomes that, as we know, they have to ac- actually be able to evidence as part of their consumer duty requirements, while also helping them run an efficient business.

So it's no longer enough to provide a product in isolation.

Let's see how that works out.

On the subject of improving compliance, publication-wise, we've had a couple of um feedback statements thematic review type statements from the fca related to consumer duty haven't we and i know you were looking at the first of those which is product and services related i believe

yes so this is yeah obviously based on outcome one of the duty it's very much a good and poor practice article rather than sort of multi-firm review so it's it's covering the entire fs sector it's not focused on any one particular product or sub-sector.

So it doesn't give any sort of overall opinion of here's where we think performance is.

It is literally here is a list of good practice examples, poor practice examples that we want to share to let firms learn from each other.

What's interesting is after the FCA for ages has been saying the consumer duty should be applied proportionally by small firms and not necessarily always being super detailed on what that looks like in practice.

So within these good and poor practice examples, they have got a few where they've specifically called out some good practice examples that they have seen at small firms.

So it's kind of four main focus areas here, which is product and service design, including the target market, testing, monitoring and review of live products, distribution and third parties, and finally, customers in vulnerable circumstances.

So what we probably need is the perfect landing page.

that that could cater to all of those and guides them to the right place so that google is in no doubt about which page to show number one it just shows looking for our banking app we don't know which audience you are so come to this page and we'll guide you like just thinking about things like that and then that makes it a relevant factor for and something we'll get into in a bit is consumer duty um you know you've got to think about consumer outcomes and if If you start to think about your search results as the first interaction somebody might have with your brand, I would argue that search results are in scope of consumer duty.

You need to actively manage them and tidy up cases like that where it might be confusing.

So bearing all of that in mind, what do we think makes for a good strategy in our industry?

So you need to provide a search result, something that the search results can hook onto that can guide people to the right place.

So navigational search is something you need to think about.

And again, I would argue that that's relevant from a consumer duty perspective as well, because if you're making it more difficult than it needs to be for customers to get in touch, that has a meaningful impact.

And then the other thing is in SEO in any other industry, you're tracking rankings predominantly.

But today's edition, we're really going to be talking about AI, particularly in the context of the mortgage sector.

at how technology is changing compliance about consumer duty and day-to-day workflows too for mortgage advisors and mortgage brokers.

I'm pleased to say that our guest today is someone who knows quite a bit about these things and Meg and I are joined by David Cotua and he is CEO and co-founder at Curvestone AI which is a London-based technology company which actually specializes in AI-powered compliance automation for regulated financial services firms.

Hi, David, great to have you on the podcast.

And as you say, it's a journey towards increasing the number that you can do, which is win-win-win on so many different levels, isn't it?

Indeed.

So moving on now, there has of course been a lot of discussion around consumer duty and the emphasis that it does place on demonstrating good client outcomes across a business.

But how do you think technology can support more comprehensive oversight whilst keeping that human judgment and accountability at the center?

People would prepare their programs because they were required to, and they would tick a few boxes, and that would be it.

Obviously, the regulator became aware of this and wasn't particularly comfortable with it, and where we finally ended up with, uh, was something called Consumer Duty.

Um, Consumer Duty is, uh...

The, the fundamental requirement is that you have a, um, a regulatory requirement to ensure that your customers get the best possible outcome.

It's a high standard.

Now, when I was looking at the changes here, uh, I was having a look at, at, um, the fair conduct program under COFI, and I thought, "Okay, that's, that's got some similarities." It, it became clear just from reading around and in conversations with various people and the like, the concept behind that is the direction of travel.

Mm.

So, okay, you don't have the full requirement of the consumer duty report here, but the direction of travel is that the board has to be res- responsible.

Love that.

So this week, we're returning to our consumer duty teardowns, which you may remember from last month, because when we first looked at them, I think it's fair to say we were all quite surprised at the scale of the accessibility issues.

So for those who haven't yet heard those episodes, Rush, do you want to give us a recap?

Yeah, so, I mean, we kind of went into the teardowns, I think, expecting there to be quite a few accessibility findings.

And, you know, we've kind of identified the problems and perhaps how we're getting here.

But why does this all matter beyond, obviously, it just being the right thing to do?

Well, yeah, like I covered them, really, I think it's... we're creating websites we're not we're not like isolating you know groups of people or people in certain situations from using these products from a consumer duty perspective as well you know firms have an obligation to provide evidence that these websites are supporting their customers and that they're easy to understand so are they um it'd be interesting to see and in some ways it'd be great even to have an influence on this whether firms are now evidencing accessibility um of their digital products um i'm not quite sure like a board report in my opinion if we're looking at a digital journey it should include accessibility because that's absolutely fundamental to um supporting vulnerable customers which is part of consumer duty so i mean i know people have spoken to is taken very seriously and it's a standing agenda that agenda item in these kind of board meetings but it would be interesting to see what level of kind of detail FCA are requiring in regards to kind of digital accessibility moving forward when we're talking about evidence because if they introduce WCAG as a regulation it's a recommendation at the moment but if they introduce it as a requirement 2.2 like the public sector have then i think these firms are going to have a lot of catching up to do um so as well as it being like a regulatory recommendation um I think as we've discussed, I think the amount of people who are going to have a better experience using accessible websites is huge.

And that just seems to be increasing as well.