Vision for Economic Growth — a roadmap to prosperity 15 Strengthened reputation for ease of operating. 1. Support the conditions for growth regulators also need license from government to pay UK regulators overseeing FPS 昀椀rms have a justi昀椀ed what’s needed to recruit and retain talent. This is about reputation for high standards, but that needs to the right balance between keeping excellent long- be matched with e昀漀cient processes. This includes term sta昀昀 and bringing in industry expertise. A major Impact by 2030 昀椀nancial services regulatory authorisations, where secondment programme between industry, regulators industry bodies such as TheCityUK have already Government’s clearly defined strategy for UK-based FPS maximises the sector’s contribution and government would also help strengthen skills and 34 Today’s o昀昀ered recommendations for improvement. to UK jobs and economic growth. encourage innovation. There could even be a scheme fragmented regulatory landscape also makes it for later careers, to encourage more experienced challenging to address cross-sectoral issues (see Figure professionals to work for the regulators. This would be Context 4 for examples). Resolving this may require a rethink of the equivalent of Now Teach, adapted for FPS, perhaps If the UK is to grow economically and create prosperity This report focuses on the speci昀椀c conditions for how agencies interact, including closer collaboration on as “Now Regulate”. This 昀氀ow of expertise in both for all its citizens, it must get the “basics” right. Many cross-sectoral issues. In Chapter 4, we propose a big growth that UK-based FPS needs in order to remain directions can bring better collaboration and solutions of these basics are not unique to FPS and represent move that, among other things, recommends extending globally competitive and contribute to a prosperous be it on sustainability, emerging tech challenges, or broader features of a 昀氀ourishing economy. The UK must UK (see Figure 3). It also celebrates the strengths that a stronger mandate to improve coordination. Financial consumer bene昀椀ts. be a place where people want to live and do business. underpin the UK as a global 昀椀nancial centre. This There must be world-class physical infrastructure includes an independent police force in the 昀椀nancial (such as transport links), digital infrastructure (such as district that can help to 昀椀ght 昀椀nancial crime, world-class Figure 4: Overview of applicable regulators for FS firms widely accessible high-speed broadband), and social legal services and a courts system that can deal with Regulatory objective infrastructure (such as excellent healthcare, schools, highly complex economic cases e昀昀ectively. Trade/ Payment System Regulator (PSR), Examples of challenges currently faced by 昀椀rms, and possible solutions and cultural o昀昀ers). Organisations need to prepare for competition future skills and talent challenges. These are all critical Financial Conduct Authority (FCA) features of a 昀氀ourishing, globally competitive economy. Competition and Markets Authority (CMA) Example 1: annual cycles of engagement Data protection Information Commissioners O昀漀ce (ICO) • Category 1 昀椀nancial services 昀椀rms have an annual Customer/ PSR, FCA strategy meeting (ASM) with regulators such as the FCA Figure 3: Conditions for growth of UK-based FPS in support of a prosperous UK public interests Prudential Regulatory Authority (PRA), and the PRA. The ASMs inform regulators’ areas of the interest that they will follow up on with a given 昀椀rm. The Pensions Regulator (TPR) • Today di昀昀erent ASMs are held with di昀昀erent regulators, Competition and Markets Authority Skills and talent Strengthened reputation for ease of operating when there is opportunity to cover them jointly. (CMA), Equality and Human Rights Regulators could follow up with speci昀椀c areas of interest Commission (EHRC), Health and Safety after the session. Executive (HSE) Competitive tax and remuneration policies A balanced approach to risk-taking Market integrity/ FCA Example 2: one-o昀昀 engagement stability Institute of Chartered Accountants • Regulators may understandably require information in England and Wales/in Scotland from supervised 昀椀rms following market events or as Skills and talent. UK organisations across the public Competitive tax and remuneration policies. FPS 昀椀rms (ICAEW/ICAES), Chartered Accountants part of eg system-wide exploratory scenario analyses. Ireland (CAI) and private sector must be able to easily recruit, and their employees make a huge contribution to the • But requests for information are not always coordinated Financial Reporting Council (FRC) — soon across regulatory bodies, and multiple stakeholders retain, and retrain talent to address the emerging UK Exchequer, with 昀椀rms paying nearly £100bn in taxes to be replaced by the Auditing, Reporting and Governance Authority (ARGA) within a 昀椀rm may be approached separately (such as the 31 needs of their businesses. Digital skills are a particular in 2020. This is roughly equivalent to the combined Market Financial Reporting Council (FRC) Chief Risk O昀漀cer for asset management, and the Chief 32 Financial O昀漀cer for insurance). watchpoint with one in eight roles in the sector now defence and police budgets for 2023-24, worth £106bn. transparency Competition and Markets • There is an opportunity to better coordinate requests But if other jurisdictions o昀昀er better deals on tax, tech roles. Some 95% of 昀椀nancial services 昀椀rms identify Authority (CMA) across regulators and streamline engagement of key data analytics and insight skills as a priority, although operations and individuals may move there. The UK Governance Financial Reporting Council (FRC) stakeholders across a given 昀椀rm. supply of these critical technical skills currently falls therefore must be competitive on tax and remuneration Tax HM Revenue and Customs (HMRC) 30 Prioritising reskilling so it as a matter of its own self-interest. Today, however, this short of demand by 20%. Single-activity industry regulator     Multi-activity industry regulator     Cross-industry regulator becomes a strategic boardroom priority across 昀椀nancial is not always achieved. In the case of a typical corporate NB some regulators are omitted from our list due to niche perimeters not 昀椀tting into our framework or because not applicable for FS 昀椀rms. For example: OPBAS, CORGI, EngC, services organisations is critical. Ensuring the sector is and investment bank, for example, the UK is projected FSR, GLAA, IPCC, SIA, Electoral Commission, Planning Inspectorate, etc. equipped with the right talent will require greater focus to have higher tax rates in 2024 than other 昀椀nancial Source: Oliver Wyman Regulatory Mapping on building future skills — including through retraining, 33 centres such as New York, Frankfurt, and Amsterdam. skills forecasting, and connections to the broader education system (eg through courses on innovation and sustainability) — as well as a genuinely responsive visa system.