Fair treatment of customers

All firms must be able to show consistently that fair treatment of customers is at the heart of their business model.

Above all, customers expect financial services and products that meet their needs from firms they trust.

Consumer outcomes

There are six consumer outcomes that firms should strive to achieve to ensure fair treatment of customers. These remain core to what we expect of firms.  

  • Outcome 1: Consumers can be confident they are dealing with firms where the fair treatment of customers is central to the corporate culture.
  • Outcome 2: Products and services marketed and sold in the retail market are designed to meet the needs of identified consumer groups and are targeted accordingly.
  • Outcome 3: Consumers are provided with clear information and are kept appropriately informed before, during and after the point of sale.
  • Outcome 4: Where consumers receive advice, the advice is suitable and takes account of their circumstances.
  • Outcome 5: Consumers are provided with products that perform as firms have led them to expect, and the associated service is of an acceptable standard and as they have been led to expect.
  • Outcome 6: Consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint.

Regulatory responsibilities

Firms are responsible for making sure customers are treated fairly. Our principles (PRIN) include explicit and implicit guidance on the fair treatment of customers. Principle 6 says: ‘A firm must pay due regard to the interests of its customers and treat them fairly’, but other principles also apply to this area of business behaviour.

These principles apply even for firms that do not have direct contact with retail customers. Risks and poor conduct can be carried from wholesale to retail markets.

Sole advisers

The expectation to demonstrate the fair treatment of customers is the same for a sole adviser firm as it is for a much larger firm. It is your responsibility and cannot be delegated away. However, this to be proportionate and relevant to the size of your firm. For example, we would not expect to see the same level of documentation or analysis of management information in a sole adviser firm than we would in a firm with a large team of advisers.

Last updated: 27 Nov 2015

First published: 12 May 2015