The new regime will come into effect on November 1 and will further the move towards principles-based regulation, placing more responsibility on individual investment companies to provide relevant information.
FSA manager of the consumer information and financial promotions team David Geale says the regulator will be focusing more on outcomes, rather than the methods investment companies use to achieve them and insists this will not result in a lowering of standards.
He says: “What that will do is give a lot more flexibility in the way they actually go about achieving that end. So that places greater responsibility on firms and senior management but then also gives a lot more flexibility for them to be innovative and creative in tailoring promotions to individual consumers.
“Rather than a one-size-fits-all approach what we expect is for them to put themselves in consumers’ shoes, think about people who are receiving the messages and what they need to tell them in that context. So it’s a lot more focused on outcomes rather than perhaps detailing the process they should go through to get there or a one-size-fits-all approach. And ultimately it should allow consumers to benefit by being able to make better-informed decisions.”