AMI asked its membership what stage they had reached with their TCF work, splitting the stages as the FSA has done: firstly ‘Awareness’, ‘Strategy & Planning’, ‘Implementation’ and ‘Embedded’. 19% of members said they were already at the ‘Embedded’ stage while a further 29% said they were implementing TCF. FSA has issued a deadline of 31 March this year for all firms to have implemented TCF in a ‘significant’ part of their business. 20% of members said they were at the ‘strategy and planning’ stage, while a further 27% were ‘aware’ of TCF. 85% of firms said they were confident of implementing their TCF strategy in time for the March deadline.
72% of firms said they had conducted a TCF review with 57% having made at least a few changes as a result. These included: changes to the information given to customers during the sales process; changes to the advice process; making more management information or data available internally; changes to the way complaints are handled; and changes to the way advisers are paid or remunerated.
Over a third of respondents said time was the biggest barrier to implementing TCF, although a similar number did state they had experienced no barriers. Other barriers outlined included: understanding of how to implement TCF; staff resources; and the cost to the company.
Rob Griffiths, Associate Director of AMI, commented: “It is pleasing to see that firms are confident they will hit the 31 March deadline date when firms are supposed to have ‘implemented TCF in a significant part of their business’. That said, only 48% stated they were either at the implementing stage or actively embedding TCF in the business. This means a large number of firms still have work to do. This should be an even greater priority given that the FSA is already determining whether firms will hit this deadline.
“Firms must actively engage in the TCF process and, for those firms who are only at the ‘awareness’ stage, a review and gap analysis must be carried out. The FSA want to see actions and changes made following a review. It also wants senior management to drive the initiative and empower staff to bring about any necessary improvements. The FSA has already stated that those who have not engaged with TCF are more likely to face enforcement action, be it undertaken against the firm itself or individuals.
“For those firms who are still looking for information on putting TCF into practice, there is a wealth of resource available including AMI factsheets, the FSA’s TCF self-assessment tool, and various specialist websites and publications. Time is certainly in short supply but the regulator wants to see a level of TCF engagement and firms should therefore make time if they haven’t already done so.”
