Report highlight’s how financial services industry feels excluded by regulator

ONLY 9% of financial services firms feel that the Financial Regulator listens to industry views when it decides upon policies and procedures.

That’s according to the first annual report of the Financial Services Consultative Industry Panel (FSCIP), published yesterday.

The report — the research for which was carried out by Millward Brown IMS — aims to air the views of the financial services industry towards the regulation model governing the sector.

It found that while 37% of companies within the industry are “somewhat satisfied” with the current regulatory model, some 18% claim to be dissatisfied. There was a call from those working in the financial services sector for the regulation bodies to be increasingly populated with people with industry background and experience.

Many also felt that the Regulator currently focuses more on consumer protection than on innovation and competitiveness — thus hindering the development of new products and services and blurring the line between customer protection and company restriction. Some 43% of those asked said that the Regulator doesn’t fully understand their business.

The other main call from companies was for a more tailored approach in the case of smaller firms, many of whom feel that the current regulatory system is a burden and for whom the cost of compliance is an issue.

As much as 63% of surveyed companies disagreed with the Financial Regulator’s statement saying that it “shows understanding of smaller firms in the development of regulatory policy and operation.”

The FSCIPs finding will now form a central part of its input to the Financial Regulator’s Strategic Plan covering 2007-2009.

“It’s a valuable exercise for all regulatory authorities to take on board the views of its key stakeholders and the financial services industry has provided valuable insights with regard to regulation and the Financial Regulator,” said James Deeney, chairman of the FSCIP.