PIMFA
SENIOR MANAGERS & CERTFICATION REGIME
The Senior Managers & Certification Regime (SMCR) consists of three key parts:
- the Certification regime
- the Conduct Rules
- the Senior Managers Regime
The SMCR was introduced in December 2019 to set a new standard of conduct in financial services, with the aim of ensuring key staff are fit and proper to perform their roles, have greater personal accountability, and to set minimum standards of conduct.
SMCR applies to almost every UK solo-regulated firm, from very small firms (including sole traders and limited permission consumer credit firms) to some of the largest global firms. It is part of the FCA’s drive to improve culture, governance and accountability in financial services. It aims to increase individual accountability and reduce misconduct. Compliance with SMCR and embedding a positive culture should be a priority for firms.
- BACKGROUND
In 2023, as part of the Edinburgh Reforms, HMT launched a Call for Evidence to review the performance, effectiveness, and scope of the regime. In parallel, the FCA and PRA published a joint discussion paper (DP) to seek input on potential ways to improve the SMCR regime
PIMFA responses can be found here:
- PIMFA response to HMT Senior Managers & Certification Regime: Call for Evidence
- PIMFA response to FCA PRA DP23/3: Review of the Senior Managers and Certification Regime (SM&CR)
Following on from this work, in 2025, the Treasury, the FCA and the PRA published consultations for a package of reforms to the SM&CR with the aim to streamline the regime, reduce the regulatory burden on firms and make the requirements clearer and more efficient.
latest news
Financial Conduct Authority (FCA) CP 26-37: Senior Managers and Certification Regime (SM&CR) Review: Phase 2
The Financial Conduct Authority has published a consultation on changes to streamline and improve the Senior Managers and Certification Regime (SM&CR) as part of the second phase of reforms. This follows on from the first phase of reforms set out in Policy Statement PS26/6.
The main proposals include:
- Reducing the number of Senior Management Functions (SMF) applications by removing certain SMFs and making other roles notified
- Streamlining the SMF application process
- Reducing the number of firms subject to the Enhanced regime by raising thresholds
- Removing on-going submissions of Statements of Responsibilities and Management Responsibilities Maps
- Streamlining the Prescribed Responsibilities
- Removing the Certification Regime
- Retiring the FCA Directory of certified and assessed persons
- Simplifying Conduct Rule training and raising breach reporting thresholds
Full details can be found here
The deadline for comments is 22 January 2027
PIMFA will be submitting a response on behalf of member firms and will arrange a workshop to consider the proposals in due course.
Member firms who wish to participate or would like to share comments via email are asked to contact Yasmin Ataullah Chkino
FCA Handbook Notice No 140
The FCA has published Handbook Notice No 140: this includes Individual Accountability (SMCR Review) Instrument 2026 implementing the first phase of reforms to the SMCR Regime, aiming to:
- Improve the operation of the 12-week rule
- Streamline the Senior Management Function (SMF) approval process
- Extend the validity period for criminal record checks supporting SMF applications
- Allow longer to notify updates to Statements of Responsibilities (SoRs) and to update certain Directory information
- Remove duplication in certification roles and provides guidance to support firms’ annual certification processes
- Provide further guidance on the scope and allocation of certain SMF/ Prescribed Responsibilities and on the application and reporting of the Conduct Rules
- Update guidance on the period covered by regulatory references on request
- Raise the thresholds for firms to be classified as Enhanced SMCR
- Make technical Handbook amendments to align with aspects of the Prudential Regulation Authority’s proposals
Access Handbook Notice 140 here.