Compliance: A review

Compliance is key to the operation and reputation of the financial services sector and is now completely embedded in the way financial services organisations carry on investment business. It is also fundamental to the Financial Services Authority (FSA) in seeking to achieve its regulatory objectives as set out in SS. 3-6 of the Financial Services and Markets Act 2000. A great deal has been written on the topic of compliance and the core objective of this paper is to review and comment on the current approach to compliance which has evolved since the introduction of the Financial Services Act 1986. It notes the change of emphasis by the FSA from individual compliance competence to organisational compliance competence. It focuses on conduct of business regulation and highlights the importance of training and competence to compliance and explains how the regulatory approach has been changing from a rules-based approach to a more flexible ethical one.