Consumer Duty: Setting new standards

What exactly is Consumer Duty?

The Consumer Duty legislation was introduced by the Financial Conduct Authority (FCA) in July 2023 to enhance consumer protection. This is the largest regulatory initiative in a number of years and focuses entirely on you, the consumer.

The new legislation has a governing principle which states that firms must: “act to deliver good outcomes for retail customers.” Whilst it may be common practice for many companies, including us, to act in this way, there is still a need to bring others in line.

How do firms deliver good outcomes?

To achieve this, they must specifically:

• Act in good faith – presenting information in an open and balanced way that outlines the benefits and risks.
• Avoid causing foreseeable harm – ensuring that products and services are designed to meet the needs of consumers within the target market.
• Enable and support clients to pursue their objectives – ensuring that the consumer is fully supported in using the products and services they have purchased and that they are able to act in their own interests.

What does it mean for Equilibrium?

We are already committed to our long-standing purpose of ‘Making People’s Lives Better’, underpinned by our values of integrity, simplicity, excellence and growth. We pride ourselves on going above and beyond to look after the needs of our clients, and “doing the right thing” even when nobody is looking, however this new rule has prompted us to look long and hard at what we do and why.

We are working hard behind the scenes to review our proposition and service to ensure that we continue to:

• Provide clarity in terms of the services we offer.
• Work with leading providers and investment groups who share our values to achieve our stated objectives.
• Remain competitively costed for the service being provided.
• Deliver tangible added value year on year.
• Explain things clearly, in plain English, avoiding the use of jargon.
• Always be here when our clients need us.
• Help our clients to live the life they want, look after those they love and leave a powerful legacy.

Ultimately, we believe that by embracing this framework, we contribute to a healthier and more responsible financial services industry.