Sheldon Mills, executive director of consumers and competition at the FCA, has claimed that Consumer Duty has been a great success in a speech at an event celebrating the Duty’s anniversary.

In his speech, a year after the implementation of the regulator’s Consumer Duty rules began, Mr Mills said the Duty is already having a tangible impact on consumer outcomes.

He claimed it has been “driving improvements in firm culture, conduct and governance” which will lead to better consumer outcomes in the future.

The regulator claimed firms it has spoken to have developed new data and metrics to better understand their customers, improved the way they capture and record information about customer vulnerabilities and expand support to better meet customer needs by adopting a ‘tell us once’ approach. 

Mr Mills also said the regulator is seeing firms being more proactive with their communications and monitoring the impact they are having.

He lauded the success of the new Consumer Duty rules, referring to changes being made by financial services firms as a result.

One of the successes Mr Mills referred to was a large advice firm which is claimed is making significant changes to its business model as a result.

He said: “In response to the Duty, a large financial advice firm is making significant changes to its business model to simplify and unbundle its charging structure, resulting in improved outcomes for clients with greater transparency and comparability with other firms and the removal of an early withdrawal charge for certain products.”

Mr Mills also responded to criticism from some commentators who have asked if Consumer Duty protects consumers at the expense of growth an innovation.

He said: “Consumer protection and growth are not mutually exclusive. They can and should be mutually reinforcing. We want to see inclusive, sustainable growth, where consumers have appropriate access to products and services that meet their needs.”

He claimed the Duty is “deliberately flexible to adapt to changes” to allow space for innovation.

However, Mr Mills also added that some firms still have a long way to go to meet the requirements of the Duty.

He said: “This is just the beginning of the journey not the end. And it’s clear that there are a number of areas where firms need to continue to make improvements. So, we know there is much more to come.”

The FCA will publish a grid of its forward programme of Consumer Duty work in August.