36% of UK financial services firms penalised for compliance failures in past year
A new study by Davies among more than 500 senior decision-makers within UK financial services businesses has found:
- 36% of financial services businesses in the UK say they have been penalised at least once in the past 12 months for failing to meet regulatory compliance demands.
- 62% say the challenge of keeping up with regulatory compliance requirements has become more acute over the past five years.
- 63% said the introduction of the FCA’s Consumer Duty in July 2023 has led to changes in the way they serve customers.
More than a third of financial services businesses in the UK have been penalised in the past 12 months for failing to meet regulatory compliance demands.
The specialist financial services consultancy division of Davies, Consulting at Davies, commissioned an independent survey of 501 senior decision-makers within UK-based financial services companies. It found that 36% of the businesses polled admitted to having faced regulatory compliance penalties between June 2023 and June 2024.
When given a list of challenges that their businesses are currently facing, regulatory compliance was the second most commonly selected option (43% cited it as a challenge) just behind economic turbulence (44%).
Consulting at Davies’ research also found that over three fifths (62%) of decision-makers in the financial services sector believe it has become more difficult to keep up with regulatory compliance requirements over the past five years.
Meanwhile, 63% said the introduction of Consumer Duty in July 2023 has led to changes in the way they serve customers.
Silvia Amoros, co-lead of the firm’s Banking & Markets EMEA practice, said: “The regulatory compliance landscape is constantly evolving, and our research shows just how many businesses in the UK’s financial services industry are struggling to keep pace with the changes taking place. Failure to do so is not only likely to incur significant penalties, but can also bring huge damage to a company’s reputation.
“Ensuring they have the trust of customers and delivering the best possible outcomes to those customers – whether they are consumers or businesses – is fundamental to the success of any financial services firm, and meeting regulatory compliance demands is central to this. For a challenge that is so significant, complex and time-consuming, seeking the support of external experts can be an effective method to ensure the business meets obligations while also freeing up time to allow its team to focus on other core business activities.”
