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TCF Indicators | Indicators | Key driver | Contra-indicators |
|---|---|---|
| Fair treatment of customers is central to the behaviour and values of the firm, and management are able to explain what the fair treatment of customers means for their firm and communicate his to their staff | Leadership | The firm cannot explain what fair treatment of customers means or management do not communicate what it means to their staff |
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The firm aligns its decisions about business priorities
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Business decisions | When the firm makes business decisions they pay no regard to the fair treatment of customers |
| The firm has controls proportionate to the size and complexity of the business, including management information, that aim to ensure and demonstrate the fair treatment of customers |
Controls | The firm cannot show customer protection through its controls and does not collect or use management information to improve its treatment of customers |
| Management make positive behaviours and attitudes to the fair treatment of customers a key criterion in the selection of staff. The results of effective training and the maintenance of staff knowledge and behaviours can be observed. Management develop their staff in the fair treatment of customers, identifying and acting on poor performance and rewarding good performance | Recruitment, training and competence |
The firm has inadequate arrangements to recruit, train and assess the competence of staff whose actions impacts on customers. It has little focus on the fair treatment of customers and has a lack of appreciation of how staff competence has an impact on customer experiences. Poor performance is tolerated |
| Management operate a reward structure that is transparent and recognises the fair treatment of customers |
Reward | The firm’s reward policy concentrates on sales made with commission and bonus payments based only on sales volumes with no measure of the quality of sales i.e. it drives behaviours which may result in customers being treated unfairly |
- FSA summary information on 'management behaviour framework' for small firms, (opens new window)
- FSA examples of good and poor practice in management behaviours
TCF - key cultural drivers and high level indicators and contra indicators
The indicators below are relevant for both relationship managed firms and for larger or more complex firms supervised by the FSA’s Small Firms Division
| Indicators | Key driver | Contra-indicators |
|---|---|---|
| Fair treatment of customers is central to the behaviour and values of all managers, they communicate messages about the fair treatment of customers effectively and apply appropriate controls and monitoring to ensure that the fairtreatment of customers is delivered by their staff | Leadership | Managers (at any level) cannot explain and/or do not communicate what the fair treatment of customers means for them and their staff and cannot demonstrate that their staff understand what the fair treatment of customers means |
| The firm has a clear vision which supports the fair treatment of customers. This is reflected within the formulation and implementation of strategic decisions (including change management programmes and outsource arrangements). The firm’s risk appetite reflects customer considerations | Strategy | The firm’s vision is unclear/blurred or contradicts the fair treatment of customers. It does not consider the fair treatment of customers when making key decisions |
| Decision making at all levels reflects the fair treatment of customers. The firm uses staff, customer and other external feedback where appropriate, with timely action. The interests of customers are properly balanced against those of shareholders (and other customer groups) | Decision making | Minimal evidence that decisions reflect any consideration of the impact on customers. The firm is slow or unwilling to react to customer/staff feedback. Conflicts between the interests of shareholders and customers are consistently and inappropriately resolved in favour of shareholders. |
| The firm has controls, including management information, that aim to ensure and demonstrate the fair treatment of customers. These controls are integral to the firm’s risk framework | Controls | The firm cannot evidence customer protection through its controls, has minimal management information and does not use this information to improve its treatment of customers |
| Management make positive behaviours and attitudes to the fair treatment of customers a key criterion in the selection of staff. They also make effective training and the maintenance of staff knowledge, behaviours and values core to the business. Managers use performance management to develop their staff in the fair treatment of customers, identifying and acting on poor performance and rewarding good performance | Recruitment, training and competence |
The firm has inadequate arrangements to recruit, train and assess the competence of staff whose actions affect customers. It has little focus on the fair treatment of customers and has a lack of appreciation of how staff competence has an impact on customer experiences. Poor performance is tolerated |
| The firm’s reward framework (including incentive schemes) throughout the business is transparent, recognises quality and supports the fair treatment of customers | Reward | The firm’s reward framework concentrates on sales, volumes and profit without consideration of quality (i.e. the framework drives behaviours which may result in customers being treated unfairly) and there are no controls that mitigate the risks that arise from this framework |
To view all of the tables – including those providing practical examples of good and poor practice for each key driver - follow the first link below.