The collective effort behind improving standards

The collective effort behind improving standards.

Welcome to our blog series, exploring the key topics being discussed in the enforcement industry. In Part 10, Dave Pickering of the Compliance, Adjudication and Review of Enforcement Panel, discusses how self-regulation works and why the importance of working together to achieve industry goals.

When I was invited to join the CIVEA CARE paneljust over a year ago, I didn’t hesitate to say yes as I was excited to be part of a concerted effort to improve standards in the industry and demonstrate how a sector can effectively self-regulate.

Having spent 30 years in financial services, including six years at the Lending Standards Board, I’ve seen first hand how self-regulation can work and how it can complement statutory regulation. Indeed, there are circumstances where self-regulation is the better option, in particular where the subject matter is subject to nuances which make it difficult to determine rules and also where you need to act quickly and flexibly. The important thing to remember at all times is to focus on outcomes, in this case, the fair treatment of debtors.

Which brings me nicely to today and where the civil enforcement industry is in terms of self-regulation and more importantly, how it’s performing in respect of improving standards. The CARE panel is one of several measures in place that focuses on standards. There is a code of practice that all member firms sign up to and an independent auditor who conducts audits at member firms to assess compliance with it. I mention the word ‘independent’ – it’s the most important word if you want self-regulation to work; it instils confidence in others that you are holding firms to account. The CARE panel views itself very much as independent and we have presented member firms with a number of challenges in our first year.

The panel has a broad mix of experience and we use it to good effect to adjudicate on debtor complaints; while we judge evidence against compliance with legislation and the code of practice, we also apply a conduct overlay and ask the question: “has the debtor been treated fairly?”

One key area for the panel has been vulnerability. This has been a hot topic in financial services and the Financial Conduct Authority for the past seven years and, in my opinion, is a key one for the sector to challenge itself on. We have applied a vulnerability lens to every case we’ve assessed since the CARE panel formed and have made several recommendations as a result. I believe that the industry is improving in this area (we have seen good progress in the last year) but there is clearly more to do. This topic will grow in importance in the next few years and if firms can get this right it will have the biggest positive perception shift possible for the sector; this is a ‘must-do’ for firms.

This year has been a difficult one, with the industry significantly impacted by COVID-19, given its reliance on home visits and the necessary suspension as the country has come to terms with lockdowns and social distancing. CIVEA has been proactive and thoughtful throughout this period with the focus on ensuring fair treatment while working with member firms to enable them to continue their work at the appropriate time when it has been safe to do so. It’s clear that we have now entered a new way of working across the UK in all industries and the civil enforcement industry will need to continue to adapt.

One final point on the future. From my short time on the panel, it is clear that improving standards needs to be a collective effort, so CIVEA will play a part, as will the CARE panel and firms, but local authorities can play a big part too in making the path to fair treatment of debtors an easier one to navigate.

So, it has been an interesting and challenging year. The continuous improvement of standards has to be our focus for the next year and the CARE panel will use its voice to influence the industry, and its expertise to help firms achieve this. I look forward to providing some further reflections next year as our work evolves!

Dave Pickering is a former CEO of the Lending Standards Board and compliance and risk specialist for Virgin Money. He is part of the Compliance, Adjudication and Review of Enforcement Panel (CARE), who independently assess civil enforcement activities to ensure they are conducted professionally, efficiently, effectively and lawfully.

Want to know more? Please see our recent CARE panel posts on how the enforcement industry embraces change and the value of transparency in civil enforcement.