Website and social media archiving platform MirrorWeb has created a guide for the UK’s new Senior Managers & Certification Regime (SM&CR).
SM&CR is a regulation to control the conduct of the operators of the financial services space. It is created and regulated by the Financial Conduct Authority to boost professionalism in the sector.
Having already been implemented in the banking sector since 2016, it will come into force for the financial services industry on December 9.
In order to help businesses ensure their compliance, MirrorWeb has created a guide to iron out any questions.
It kicks off by explaining that the SM&CR is built around three core areas: conduct rules, the senior managers regime and the certification regime.
While requirements differ depending on the size of the firm, the three areas essentially focus on whether or not someone is right for the job, how bosses and employees are held accountable for their actions.
MirrorWeb advices that this boils down to five key takeaways.
Firstly, a firm’s senior leadership must know what they are responsible for.
Secondly, the SM&CR focuses on skills, capability and conduct.
Thirdly, all firms must have a sense of accountability running through it.
Fourth, systems and controls mean senior management suitability should be easy for the FCA to assess.
Finally, the FCA will hold individuals to account, not the firm.
This was something Barclays CEO Jes Staley found out the hard way in May 2018 when he became the first person to be fined following an SM&CR breach. Staley had ‘breached the standard of care required’, as he used the bank’s resources to try and identify an internal whistleblower, disregarding the fact these people have special regulatory protections.
This ended up landing him personally with having to fork out for a £642,430 fine issued by the FCA and PRA. To top it off, Barclays took back a £500,000 bonus from him.
MirrorWeb has created a checklist to help businesses ensure they are compliant with SM&CR. You can find it and the rest of MirrorWeb’s guide here.
To find out more about MirrorWeb visit their website.
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