By the end of this month, the governing body of every FCA-regulated firm that sells to retail customers has to sign off a document that, three years ago, barely existed. The annual Consumer Duty board report is due by 31 July, the third since the Duty took effect in 2023, and boards have to review, challenge and approve it before the clock runs out.
On paper this is a governance formality. In practice the report has become something more useful to the regulator than to the firms filing it: a standing evidence base the FCA can read to tell apart the firms that can demonstrate good customer outcomes from those that can only claim them.
The shift did not happen by decree. It happened because the FCA has now read enough of these reports to know what good looks like, and in April it published the answer key.
What changed in April
On 16 April the FCA published a blog, “Year 2 Consumer Duty Board Reports: progress and what comes next”, alongside an updated set of examples under the heading “Consumer Duty board reports: good practice and areas for improvement”. Between the two documents the regulator set out, in unusual detail, what it wants to see in a board report and what it is tired of seeing.
The findings rest on a substantial sample. The FCA reviewed 180 first-year board reports and 80 second-year reports, 260 in total, spanning firms of very different sizes and business models. That is no longer a spot check. It is a dataset, and the good-practice and areas-for-improvement split that came out of it functions as a grading rubric that any board can now hold its own report against.
The FCA’s own language is deliberately supportive. It frames the examples as material shared “so that everyone can learn and improve”, stresses that they are not prescriptive, and says firms should decide for themselves how to strengthen their reporting. Nobody at the regulator is calling this a supervisory triage tool. But read the findings closely and that is the effect.
The gap the FCA keeps flagging
The single most repeated criticism is about challenge, and it is a telling one. The FCA found that while most boards did review and approve their reports, many failed to document the challenge they had provided. The minutes did not show the questions directors asked, the evidence they tested, or the follow-up actions they demanded.
That matters because a board report is only as credible as the scrutiny behind it. A firm can produce a polished document full of outcomes language and still leave no trace that anyone senior interrogated whether the numbers meant what they claimed. To a supervisor, an undocumented sign-off looks indistinguishable from a rubber stamp.
The regulator was clearer this year about what it expects instead. Boards should ensure their papers and minutes set out the discussions they had, the questions raised and any actions requested. Firms should show how they used data and customer insight to understand real experiences, not just report that monitoring took place. The direction of travel is unmistakable: the FCA wants evidence of a decision-making process, not a compliance artefact assembled to hit a deadline.
Why this reads as a triage input
The reason the board report has grown teeth is structural. The Consumer Duty is an outcomes-based regime, which means the FCA cannot supervise it by ticking boxes. It has to form a view about whether a firm is actually delivering good outcomes, and the annual report is the firm’s own account of exactly that, signed off at the highest level.
A regulator sitting on 260 reviewed reports has a reference distribution. It knows what a thin report looks like, what a firm with weak data capability produces, and what genuine board challenge reads like on the page. When the next report arrives, it can be placed against that reference almost immediately. Firms that can evidence outcomes move down the supervisor’s list of concerns. Firms that assert outcomes without showing the working move up it.
None of this is stated as policy, and it is worth being precise about that. The FCA’s public posture is developmental, not punitive, and the good-practice publication is genuinely a teaching document. The supervisory read is Clarqo’s, not the regulator’s. But the incentives point one way, and boards signing off this month would be unwise to treat the exercise as anything less than the primary evidence the FCA will hold against them.
What firms should do before the deadline
The practical checklist follows directly from the April findings. Document the board’s challenge, not just its approval. Tie outcome claims to monitoring data and customer insight rather than to management assertion. Be candid about areas where outcomes are not yet good and set out the remediation, because a report that finds no problems anywhere reads as a report that was not looking. Above all, treat the report as the firm’s supervisory case file, drafted for a sceptical reader who has seen 260 others.
The horizon is not standing still either. The Year 2 blog signalled that the FCA will consult this year on changes to rules and guidance covering distribution chains, and the regulator has separately opened work on Consumer Duty scope and proportionality. The reporting expectations that firms are meeting this July are a baseline, not a ceiling.
A curtain-raiser, with one caveat
This deadline is a scheduled event, not breaking news, and the FCA has given no signal that it intends to move the 31 July date. The Duty’s annual cadence has held since 2023, and the regulatory calendar here is fixed and public.
The larger point stands whatever the exact filing date. Under an outcomes regime, the document a board approves once a year is the clearest single statement a firm makes about whether it is serving its customers well. The FCA has now read enough of them to know the difference between a firm that can prove it and a firm that is hoping nobody asks. This month, every board gets to decide which one its report describes.
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