Following a consultation launched in January this year, the Financial Conduct Authority (FCA) has decided to exclude the head of legal of all of the banks, insurance companies and other financial institutions that it supervises from senior manager accountability under the Senior Managers & Certification Regime (SMR). You can access the FCA’s policy statement here.
A group of us at UCL Laws submitted a detailed response to the consultation. In that response we objected to the proposal to exclude general counsel from SMR. Our response paper drew on both our own research and learnings from other scholarship; we argued that inclusion would strengthen the position of in-house lawyers within regulated financial firms and deliver benefits both for the firms themselves and for the economy and society. We found the arguments made against inclusion during the consultation misunderstood the broad-ranging and significant role that most in-house legal departments play in those firms. The FCA’s grounds for exclusion were not in our view compelling, not least the argument that legal professional privilege should be given super-priority over the public interest arguments in favour of inclusion. You can read our detailed response here.
