Consumer Duty: outcomes, oversight and governance

What happened?

The FCA continues to use the Consumer Duty as its principal lens for assessing whether financial services firms are delivering good outcomes across the customer lifecycle. Having spent considerable time building governance structures, oversight arrangements and reporting frameworks, firms are now expected to demonstrate that these arrangements are actually driving positive outcomes rather than simply existing on paper.

Supervisory activity is examining whether products and services reflect clear customer needs, whether price and value are justified over time, whether communications support real customer understanding, and whether customers receive support without unnecessary friction. These four areas map directly to the Duty’s outcomes framework.

Why does it matter?

The FCA has been explicit that Consumer Duty is designed to raise standards without adding prescriptive rules, which means firms must be able to demonstrate how their governance and decision-making support customer outcomes and can withstand scrutiny. Stable metrics or low complaint volumes are not, on their own, evidence that customers understand products, receive fair value or get appropriate support.

The emphasis has shifted from what firms have built to how those arrangements perform, which means stronger management information, greater internal challenge and clearer accountability for outcomes are now the areas under the most scrutiny.

Who is affected?

The findings apply across retail financial services, including wealth management and financial advice, pensions and retirement income, payments and fintech, banking, consumer credit and lending, general insurance and protection, and motor finance.

Key risks

• Board reporting that describes structures but does not evidence outcomes
• Reliance on incomplete or evolving data when boards are asked to exercise judgement
• Weak data quality and limited challenge in existing monitoring arrangements
• Insights identified through monitoring not translating into action

Actions to take

1. Review whether current frameworks deliver measurable, evidenced customer outcomes
2. Reassess fair value and product governance approaches against recent FCA findings
3. Strengthen outcome monitoring and the management information that supports it
4. Produce board reports that focus on outcomes, use good-quality data and link findings to action
5. Review customer journeys and communications against FCA expectations

Wider implications

The FCA’s review of Consumer Duty board reports found that stronger firms focus clearly on outcomes, use good-quality data, analyse different customer groups and link findings to actions and strategy. Areas for improvement identified by the regulator include data quality, board challenge and taking effective action based on insights.

Consumer Duty is not a one-off implementation exercise. Firms are expected to continuously assess outcomes, challenge assumptions and adapt governance as products, customer needs and regulatory expectations evolve.

Recommendations

Firms should consider whether independent challenge, additional specialist resource or periodic assurance reviews would strengthen oversight and give greater confidence in the effectiveness of their Consumer Duty framework. Some firms are also exploring how technology can supplement traditional monitoring: TCC works with technology partner Recordsure to help firms analyse customer interactions at scale, identify emerging risks and build richer evidence for outcome monitoring and board reporting.