FSA sets up non-exec director consultation

The FSA has issued a consultation on guidance for non-executive directors (NEDs).

The regulator says the guidance aims to help NEDs understand their role in ensuring customers are treated fairly within their firms.

The FSA expects NEDs to play a pivotal part within the firm’s governance by ensuring that the firm is meeting its responsibilities to retail customers. The guidance proposes that amongst the issues that NEDs should consider are:

* taking a strategic view to treatment of their customers
* being confident that the firm is identifying, monitoring and mitigating risk to its customers
* having the right mix of skills on the Board and the right information to be able to constructively challenge the executive and
* supporting a culture within the firm that takes into account fair treatment of customers

Clive Adamson, FSA director of supervision, conduct business unit, said: “Non-executive directors have a duty to challenge the management of their firms where they believe the firm could do more to ensure that customers get fair treatment.