Having run supervision workshops for so many Senior Managers over the years, I would be a wealthy woman if I had a pound for every time I’d heard the following…
“Yeah, I get that I have to manage my teams, but who is managing me?” or my favourite “who manages the managers?”
My response to the second question is always more of a challenge back to the person asking the question i.e. “Don’t you know how your Senior Managers are assessed as competent?”
It stopped shocking me years ago, that training and competency schemes (now incorporating the policy regarding F&P procedures) still only go as far as Team Leaders or Desk heads. So many have no reference to the competency expectations of Senior Managers.
The competency expectations have not changed for Senior Managers, what has changed is our need to evidence this
This is particularly true of the wholesale world where competency evidence has been patchy to date, to say the least. All of this despite the regulator trying their best to push the competency expectations up the agenda over recent years. Let’s face it, the Senior Managers Regime was introduced specifically to ensure the quality of senior management and their governance arrangements were improved. Previously the T&C sourcebook was elevated to High Level Standards section of the Handbook and more recently the page on the FCA websites updated with information on their expectations.
The competency expectations have not changed for Senior Managers, what has changed is our need to evidence this. It means the informal pat on the back from the Chair is no longer sufficient. Those at the Board table with a SMF number to their name need to have a framework of assessment and have their feet held to fire by their peers and in particular the Chair, who is most likely to have the responsibility for ensure the governance and F&P of SMFs is maintained.
How do firms begin to build a framework for those at the very top of an organisation? Well, in my humble opinion it’s very much the same as a build for any other employee. What are the key competencies you expect them to have and how do they demonstrate they are meeting these?
If we take just one example around the expectation that SMFs understand governance and oversight responsibilities. How might we measure their competence has been maintained and how do we evidence this? Take this as a for example;
- No breaches of FCA code of conduct
- Attendance at relevant meetings and provides challenge in meetings
- Has attended training/conferences/CPD to ensure knowledge is up to date on this topic
- Formally recorded discussion about development in annual review with Chair
- Demonstrate and documented reasonable steps in relation to this competence
- Handover documentation is up to date and current, outlining their responsibilities within the governance and oversight framework
- Formal participation in periodic Board evaluation
Most likely it will be the Co Sec who keeps the records for the Chair. And, taking this one step further it should be interrogated as part of an internal/external audit in 3rd line activity.
It’s not rocket science and like individuals further down the organisation in certain circumstances the same evidence can be used across other areas of competence. It seems only right that those employees who are taking the time to be trained as supervisors, should be reassured that similar methodology is deployed at the top and that it is taken seriously at all levels. Be in no doubt, the FCA is taking it very seriously.
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