The Financial Services Authority (FSA) has published a paper setting out its current thinking on its move toward a more principles-based regulatory regime.
The paper, titled “Principles-based Regulation – Focusing on the Outcomes that Matter,” accompanies a conference being held today at which FSA senior management, financial services industry leaders and other interested parties debate the challenges and opportunities presented by a move away from more detailed rules to a principles-based environment.
“We have set ourselves and the industry on a course towards more-principles based regulation,” said Callum McCarthy, chairman of the FSA. “We are pursuing this with determination, but recognize there are difficult issues as well as excellent opportunities for us as a regulator, the industry and consumers. Today’s paper and conference are designed to explore those issues as we attempt to move further towards delivering a more outcome-focused regime.”
John Tiner, chief executive of the FSA, added: “Financial services markets are dynamic and innovative. To be effective, regulators must be able to adapt their regimes to keep pace with market changes. We believe principles which focus on an outcome are more enduring while at the same time better foster innovation and competition.”