“When a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully,” said Samuel Johnson.
With the newly-published consultation document on the Financial Services and Markets Bill (FSMB), the Financial Services Authority (FSA) is hoping to go one better and find that the mere risk of financial rather than capital punishment will make senior executives concentrate more on regulatory compliance.
The objective
The FSMB, which is scheduled to receive Royal Assent this spring, creates the FSA as the statutory regulator for financial services in the UK.
According to clause two of the bill, the FSA will be charged with making rules and issuing codes in connection with its regulatory function.
The FSA has recently published a consultation paper containing proposals for authorised firms in relation to their senior management arrangements, systems and controls.
The objective of these proposals is to encourage authorised firms to promote a strong compliance culture and for firms to vest responsibility for effective organisation in specified individuals, by establishing a link between corporate and personal responsibility.
