The chief executive of the Financial Conduct Authority (FCA) Nikhil Rathi has outlined what lies ahead for the financial regulator post-Brexit, and eventually post-Covid-19.
In his speech to the Association of Foreign Banks (AFB), Rathi highlighted the important role international firms play and have played in helping ensure competition in UK markets.
Rathi says: “Our regulation of overseas firms is aimed at achieving the same outcomes as our regulation of domestic firms, and ensuring a level playing field. We want to see high standards of conduct and behaviour, with appropriate protection for markets and consumers.”
In order to continue with international co-operation, the FCA have signed a Memoranda of Understanding with regulators across Europe and with the European Supervisory Authorities.
The financial regulator has also be working with UK government on the broader UK-EU Memorandum of Understanding on regulatory co-operation in financial services.
Rathi acknowledges that in the wake of Brexit, some firms have restructured their activities to ensure they are able to operate across different jurisdictions, and serve clients throughout Europe.
The FCA will continue to work with the EU going forward with increased flexibility, for example earlier in the year, the FCA proposed to increase the limit for contactless payments to £100. Last week, a consultation launched on Markets in Financial Instruments Directive (MiFID) rules on research and best execution reporting.
Climate change progress
Rathi also said in his speech, that the UK government has asked the financial regulator to work towards a net-zero economy by 2050.
With this goal in mind, the FCA have hired Sacha Sadan from Legal and General Investment Management (LGIM) as their first Director of ESG (environmental, social and corporate governance) to help understand climate change.