Ep. 116 - Navigating the Maze: David Morrey on Risk, Regulation and the FCA’s Growth Agenda
With Consumer Duty fully in play, many advice firms are still wrestling with the practicalities of delivering “good outcomes.” In the latest episode of the podcast, Abraham Okusanya welcomes David Morrey, Partner at Grant Thornton, to explore what financial regulation really looks like behind the scenes.
Drawing on decades of regulatory insight, David unpacks how the Financial Conduct Authority’s evolving mindset is reshaping adviser responsibilities and expectations. This conversation offers a rare glimpse into the regulatory psyche and provides practical takeaways for advice firms navigating this shifting terrain.
The FCA’s Growth Agenda: What It Means for Advice Firms
David outlines a significant shift: the FCA is no longer purely reactive. Its current growth agenda signals a more proactive, developmental supervisory stance. Rather than focusing solely on misconduct, the regulator wants to help firms grow responsibly. This is particularly relevant for firms involved in Adviser M&A or private equity-backed expansion, where scale must not compromise client outcomes.
Ongoing Advice as a Turning Point
One of the more striking themes is the FCA’s approach to ongoing advice. David highlights that this is now a litmus test for Consumer Duty compliance. Firms that treat annual reviews as a tick-box exercise will likely face scrutiny. Instead, advisers must ensure these interactions demonstrate continuing value, are recorded properly, and are genuinely client-centred.
This marks a pivotal shift in supervision. Firms can no longer rely on past performance. Proving ongoing suitability and fairness is now a regulatory priority.
Targeted Support: A Shared Challenge for Banks and Advisers
Targeted support isn’t only for vulnerable clients. It’s now a broader expectation, covering clients experiencing temporary or situational difficulty. David suggests this blurs traditional boundaries between banks and advice firms. The ability to identify and respond to emerging needs is no longer optional.
This is where advisers can truly differentiate themselves. Systems that flag changing client circumstances, paired with a strong advice process, are now strategic assets.
Fair Value: A Tool, Not a Box-Tick
The fair value element of Consumer Duty continues to cause confusion. David clarifies that this is not a one-off exercise. It's a continuous process that requires advice firms to assess whether fees align with the service provided and outcomes delivered.
Rather than a threat, this presents a strategic opportunity. Firms that use fair value assessments to drive pricing reviews, improve transparency, and refine service propositions are better placed to build long-term trust.
The Consolidation Curve: What’s Next?
As consolidation accelerates, many firms are being approached by private equity. David brings valuable perspective here. While investment can bring opportunity, it also raises regulatory expectations. Larger groups must demonstrate robust oversight across all their advice businesses.
Advisers within consolidated firms need to remain vigilant. The FCA’s expectation is that systems, controls, and culture must evolve with scale.
