Upgrading your Consumer Duty training in 2024: Do’s and don’ts

As we approach the first anniversary of the Consumer Duty, the FCA’s message has been clear – implementation of the Duty is not a ‘once and done’ exercise, rather firms need to be improving continuously.

While you may feel positive about your firm’s pre-implementation training programme, it’s important to recognise that training on the Duty should not be a one-off. Instead, firms should be using training as part of the ongoing work of embedding the Duty right across their organisation. This means thinking carefully about how we can enhance and upgrade our training.

The following ‘Do’s and Don’ts’ are based on our experience of delivering ongoing Consumer Duty training for many different clients, across multiple market sectors.

1. Don’t simply repeat the previous training

When workloads are heavy, it can be tempting to simply repeat the training that was delivered last year. However, this approach doesn’t align well with the enduring cultural shift which the Duty necessitates. In addition, it fails to address the important developments that have occurred in the past year. Of course, some of the key messages may be repeated, but our training needs to be updated to reflect the FCA’s current agenda and the industry’s increased understanding of the Duty.

2. Don’t assume too much prior knowledge

All of your colleagues completed the initial training, so they will all have a good knowledge of the Consumer Duty – right? Based on our experience, the reality may be rather different.

For some of us, the implementation of the Duty has been our major preoccupation for the last eighteen months, or more. However, this isn’t true of the vast majority of our colleagues, and most will need a refresher on the key points.

3. Don’t focus solely on factual information – make it practical

The measure of success for Consumer Duty training is not that every employee can recite large sections of the rulebook. Instead, we want to help our colleagues understand the practical implications of the Duty for their own role. While we may need to communicate key elements of the rules, the ultimate goal is to answer the ‘So what?’ question – what difference does this make to what I do on a day-to-day basis?

1. Do incorporate key messages from the FCA

Since July 2023 the regulator has published a stream of reviews, updates and speeches on various aspects of the Duty. While your colleagues don’t need to know the details of all of these, refresher training is a great opportunity to update them on the FCA’s key messages.

2. Do include realistic scenarios – including for non-customer facing staff

One of the principal ways in which our training can help colleagues understand what it means to deliver good outcomes for our customers is by the use of realistic case studies.

It’s particularly important that these include what the FCA has described as ‘grey area scenarios’ – in other words, case studies where a single, clear and correct answer may not be obvious. Relevance is also vital – we need to ensure that our examples reflect a range of job roles and don’t only focus on those who are customer-facing.

3. Do ensure that colleagues understand the new Conduct Rule

In our work, we have found that one of the most common gaps in knowledge relates to the new Individual Conduct Rule 6 – “You must act to deliver good outcomes for retail customers”.

Remember that firms have an obligation to ensure that employees understand how the Conduct Rules apply to them (COCON 2.3.1). In the context of the Consumer Duty, it’s particularly important that our colleagues understand the significance of the three cross-cutting rules which underpin Rule 6, as well as the fact that the new rule represents a higher standard of conduct.

If your inbox and calendar are full of new projects and tasks, upgrading your firm’s Consumer Duty training may not seem like a top priority. However, it’s important to remember that training plays an important role in helping us to embed the Duty right across our organisations and it’s worth taking the time to get it right.

If you want to know more about the options for Consumer Duty training, or simply want to share your own experience of upgrading your training, please get in touch.

Nigel specialises in training boards, senior executives and other staff on the impact of regulation and regulatory change.

He is a CFA Charterholder and Chartered Fellow of the CISI, with over 20 years' of industry experience.

With a background in compliance in private banking and wealth management, Nigel has a particular interest in effective corporate governance and the management of compliance and regulatory risk. His interests also include issues relating to ESG and climate risk, conduct and culture (including non-financial misconduct), and all aspects of financial crime prevention, as well as the impact of fintech on compliance and regulation.

Recent assignments have included briefing multiple boards and executive teams on the Consumer Duty, delivering compliance and ethics training for senior managers and front-office staff and creating a user-friendly risk and compliance handbook for a major bank.