FSA moves to more “principles-based regulation”

The Financial Services Authority (FSA) has announced that it intends to focus on the organization’s move towards more principles-based regulation (MPBR).
The Business Plan for 2007/8 outlines increased spending on financial capability and key investments to be made in people, information systems and the way the FSA regulates, to facilitate the move towards MPBR.
“More principles-based regulation will produce significant benefits for firms, markets and consumers but we need to invest in our people and information systems to realise this change,” John Tiner, FSA’s chief executive, said in a statement.
New initiatives are limited, but include work on the impact of climate change on the financial services markets.
“In the year ahead we are also placing increased emphasis on and investment in our National Strategy for Financial Capability,” Tiner continued.
“Lack of financial understanding among consumers has been recognised as a priority risk by the FSA and the need for more confident, capable consumers who can take advantage of a more dynamic marketplace has never been greater.”
The review of retail distribution and payment protection insurance will also continue to be a main priority of the FSA.