FCA chairman John Griffith-Jones has defended the regulator’s “pragmatic” data collection despite industry concerns over escalating costs.
Speaking at a Wealth Management Association conference in London this morning, Griffith-Jones said good data is a precursor to good regulation.
Last week, Treasury select committee chair Andrew Tyrie hit out at the regulator for “mindless” data collection from regulated firms.
Research from the Association of Professional Financial Advisers puts the total industry cost of meeting regulatory reporting requirements at over £10m a year.
Griffith-Jones said: “While I can sympathise, and have been lobbied pretty vigorously by your leadership, about the amount of time spent wading through our consultation papers, guidance documents, our calls for evidence and our requests for data; my sympathy is tempered by a little bit of pragmatism.
“By all means keep challenging us on the volume of requests but do not lose sight of the value of good data as a precursor to better regulation.”
Griffith-Jones says the greater use of thematic reviews and collecting data from firms is to enable the regulator to spot future problems.
He said: “One of the key developments in our approach is to try and signpost more effectively our direction than in the past. For example, using regulatory levers like thematic reviews to pull in data from across the whole of the market at the same time.
”The rationale here is that it makes us much more predictable in what we’re looking for and enables us to see the big picture all at once to understand whether there are broad and really important issues we should be concentrating on.
“Clearly this approach is somewhat different from the old FSA approach of inspecting individual firms one by one and it has the great benefit to you of allowing the markets to respond before there is any widespread call for enforcement action or redress. It certainly shouldn’t pose difficulties for the firms that are already operating to the highest standards.”