Navigating the Senior Managers & Certification Regime using the NACFB Compliance Hub

October 8, 2019 James Hinch

Natalie Charteris of South West Business Finance writes a review of the NACFBs’ SM&CR Hub.

Having seen a few articles and Financial Conduct Authority (FCA) press releases regarding the SM&CR, I was initially daunted by yet another acronym (having just recovered from GDPR)!  However, I was delighted to find out that the NACFB compliance team have put together an information hub with everything you need to know in one place.

In short the SM&CR replaces the Approved Persons Regime and aims to better allocate responsibility to individuals, set key responsibilities for senior managers, requires firms to certify other staff who pose risk of customer harm and ensure that almost all employees have basic conduct training.

The hub can be accessed from the NACFB Compliance website and the useful timeline format makes it really easy to navigate all the information and to find out which parts are relevant to our firm and what action I need to take.

I start off by consulting the Broker Journey timeline on the website and my first job is to determine if the SM&CR applies to our firm and if it does under which category?

Following this I can identify the Senior Managers in our firm and check if the current controlled functions will be converted or whether I need to apply for new ones?

My next task is to download the Statement of Responsibilities template and draft one for each of the Senior Managers ensuring that all the applicable prescribed responsibilities have been allocated to them.  I use the Prescribed Responsibilities table on the hub to ensure that nothing is missed.

I then check if any of the certification functions apply to our firm and whether I need to apply the Certification Regime before refreshing my knowledge on what is required on the fitness and propriety of Senior Managers for performing their roles.  I reflect on how I can incorporate these checks into our existing HR processes. 

Finally I download the conduct rules so I know what training/refreshers are needed to give to the team.  I then complete the administrative side of the conversions on the FCA Connect system and provide training to the team on the conduct rules at our next team meeting.

By referring to the useful SM&CR readiness checklist, I can be sure that I haven’t missed any steps and have given this the full attention it deserves as it is all about making individuals more accountable.

The support provided from the team at NACFB compliance is excellent and the fact that they have simplified all the information in one place means that I can save time scouring the internet or reading all the FCA papers on the changes.  It also means that the information is completely relevant to us as a brokerage firm.  I would recommend the SM&CR hub to anyone starting their journey on making these key changes.