How our Consultants can help you
Kate Pomfret
7 July 2022More and more of our visits are around the Consumer Duty currently, and we expect this will only increase. We have seen a real uptick in interest in advisers and Directors wanting to have support in narrowing the knowledge gap around Consumer Duty. We are supporting them in understanding what is currently known ahead of the final rules being published, and potential ways of implementing change to meet the proposed regulations. Although it is not expected to come into effect until April 2023, the FCA have repeatedly made it clear that they expect firms to be able to demonstrate they are working towards the required standards prior to that if asked.
In addition to Consumer Duty, the following array of activities are just some of the types of visits the Consultants have done recently to help our firms manage existing regulatory risk and to help prepare for future regulation;
One to ones (1:1s)
1:1s are an important part of how you manage your businesses, and can be very time consuming. The Consultants are able to undertake these for a firm and report back the results to the Directors. This frees up time to do other jobs that cannot be delegated. It is sometimes easier for an external consultant to undertake 1:1s, for example, if you are a smaller, close-knit firm, it can sometimes be harder to do 1:1s objectively. That is where our Consultants help, acting as an additional member of your management team to support you.
Role-playlays and T&C
Part of getting an adviser to reach competent advisor status (CAS) can involve observations, role-plays, individual training and assessment of files, to name a few possible requirements. Our Consultants regularly undertake all of the above to help support advisers get to CAS. Additionally, these can all be also be part of assessing an advisers ongoing competence, providing evidence to support any SPS certification.
Investment Proposition and Processes
Firms with multiple advisers sometimes have differences in processes depending on the adviser. One of our Consultants spent a day with a firm going through their investment proposition, processes and costs and charges. He was able to help and support the Directors in developing a standardised process and way of charging. This enabled the firm to de-risk some of the processes and start to think about the impact of charges. Consideration was given to fixed charges not a percentage, and should there be a cap on percentage fees? With the Consumer Duty looming, price and value will need to be assessed and this was the first step for the firm towards addressing these outcomes.
New Firms to Paradigm
One of the areas the Consultants enjoy most is helping newly authorised firms, or new firms to Paradigm, get their back office into shape. Making sure they have all the relevant systems, controls, processes, reports and management information (MI) in place to run their business as smoothly as possible with a view to helping make current reporting requirements less arduous, in turn meaning that firms can concentrate on their clients. The Consumer Duty is going to increase the need for MI, as well as documenting the MI and interrogating it. Our Consultants are helping firms start to think about this and any future implications and consideration that may be required.
Succession Strategies
Firms are becoming more savvy with regards to possible succession, sale and purchase. Paradigm has The Agency to support advisers through a 3-step process of building your business, preparing for sale or investment and maximising value. Our Consultants can help you in all of these areas, and their extensive experience means that they can be a valuable sounding board for you and a voice of reason.
Support with FCA requirements
Sometimes our firms get themselves on the FCA’s radar. This is usually for the smallest of reasons, the wrong figure on a return for example. However, any communications from the FCA should be treated seriously. Our Consultants can help do an analysis on your firm to spot any potential vulnerabilities. Once identified, they can work with you to implement any potential changes. The Regulator likes to see that firms are happy to take a look at themselves and improve if it is required and too see that this is embedded in the culture of the firm as a continuing process. The support the Consultants offer can help document this process and instill this ethos, thus helping to strengthen your business.
Locums
This is an area that often gets overlooked. When selecting a locum, it is important to give proper consideration to your choice, and this is something the Consultants can also assist with. They can ask, and help you answer, questions such as: Do they have the same permissions as your firm? Do they use the same back office? Do they know how to access your systems?
Given the unprecedented times we have been through the last few years, locums have come in to more focus. Business Continuity plans as a whole have been tested over the last couple of years. The Consultants have helped several firms to ensure that their business continuity plan remains a versatile, ‘living’ document which reflects the ever-changing needs of both the firm and the Regulator.
Ongoing Support
Whilst formal visits are a key part of the Consultants role, they are not just available for the day. They aim to develop a longer term relationship with your firm and become part of your team. In this capacity, they are available by email or phone throughout the year for questions and chats, more than ably backed up our Technical Helpdesk.
The above are just some examples of the activities the Consultants undertake with firms. Training, presentations, talking at team meetings, compliance updates, help explaining what needs to be on returns and checking attestation has been completed on time and correctly are a few of the other activities they also undertake. With the Consumer Duty final guidance due shortly, the need for bespoke support for your firm will become even more important. One size will not fit all. So if you have any questions, please feel free to contact us, as our whole ethos is based on providing the bespoke support that your firm needs. We are always happy to help and can help make the upcoming changes as smooth as possible for you.
