The Financial Conduct Authority (FCA) is set to expand its regulations on non-financial misconduct to a broader range of City investment firms and brokers, affecting nearly 40,000 companies. Starting next month, these new rules will require firms, including hedge funds, insurers, and pension funds, to report serious cases of bullying and harassment to the financial watchdog.
The expanded crackdown, which previously focused on the banking sector, will also mandate that firms share reports of bad behaviour, such as racism, sexual harassment, violence, and intimidation, with a manager's prospective future employer. This measure aims to prevent individuals with a history of misconduct from moving between firms without consequences.
Experts note that hedge funds, investment managers, insurers, and brokers are actively preparing for the new regulations by training staff and concluding internal investigations. Jill Lorimer, a partner at Kingsley Napley, stated that firms are updating policies and procedures to ensure readiness for the September implementation.
The FCA's spokesperson commented that unchallenged bullying, harassment, or violence raises questions about a firm’s culture and can harm confidence in financial services. The spokesperson added that while the rules will promote a consistent approach, firms retain primary responsibility for preventing and addressing such behaviour.