Understanding delegation under the Senior Manager Conduct Rules

As we near the end of March, brokers are rushing to ensure that staff are trained in and complying with the FCA’s Individual Conduct Rules*, but it’s the Senior Manager Conduct Rules** – and one of these in particular - which can really help staff to meet some of the new standards, as UKGI explains.

In the course of our working life, most of us will have experienced the good, the bad and the downright ugly of having things delegated to us. We’ve probably all encountered at one time or another a manager who throws a task or problem over the fence and continues on their merry way having (in their minds) discharged their responsibility. But there’s an art to delegation and that’s not it.

When we train staff in the Individual Conduct Rules, we always share the Senior Manager Conduct Rules with them as well, so they understand how the FCA views conduct across a business and at all levels. The rule which always interests ‘non-Senior Managers’ the most is the one about delegation; this requires Senior Managers to take “reasonable steps to ensure that any delegation of … responsibilities is to an appropriate person and … oversee the discharge of the delegated responsibility effectively.”

What the FCA is expecting falls into two parts. First, that, when delegating, a Senior Manager ensures the individual to whom they are delegating has the necessary capacity, competence and seniority to deal with the issue. Secondly, that delegation doesn’t mean a washing of hands; a Senior Manager can delegate an issue, but they cannot delegate responsibility for it. It remains their duty to adequately supervise and monitor.

As a Senior Manager it pays to make sure you meet these criteria because if you don’t, any failure in relation to the issue is likely to remain your responsibility and you’re potentially in breach. Plus, poor delegation is likely to make it harder for your staff to meet some of the Individual Conduct Rule requirements which apply to them - such as acting with due skill, care and diligence. That’s difficult to do if you are over stretched and un-resourced, plus it’s harder to escalate concerns if no one is interested.   

Delegating appropriately and maintaining oversight are simple steps to follow and the benefits aren’t just about meeting the Conduct Rules; they also make sound business sense. So, if your delegating skills need a brush up, maybe now’s the time.

Where can you brush up on your skills?

UKGI provides training for Senior Managers on the Senior Managers & Certification Regime and the Individual and Senior Manager Conduct Rules which are integral to the regime. 

Currently UKGI is conducting training sessions for many firms which are looking to ensure their staff impacted by the Individual Conduct Rules understand how these rules apply to their role using scenarios and discussion to help bring the rules to life. Such training often includes refreshers for Senior Managers too.

You can also access a variety of learning modules on Aviva’s Development Zone, just search for SMCR when you’re logged in.

We also have a series of interactive, animated Conduct Rule scenarios for you to access. If you want to request access to the Development Zone, please speak to your sales manager.

Firms need to ensure that all staff impacted by the Individual Conduct Rules are trained in and complying with these rules ahead of the FCA’s 31st March 2021 deadline.

* https://www.handbook.fca.org.uk/handbook/COCON/2/1.html

** https://www.handbook.fca.org.uk/handbook/COCON/2/2.html