FCA review of Consumer Duty Board reports: progress and priorities for improvement

On 16 April 2026, the FCA published its observations comparing its review of firms’ first and second annual Board reports under the Consumer Duty. The regulator observed meaningful progress in governance, MI development and customer focus, but also identified material gaps that require prompt remediation.

The FCA notes that many firms have strengthened Board oversight of customer outcomes, embedded clearer accountability for Duty deliverables and begun to use outcome‑focused MI to challenge product, price and service decisions. Several firms have improved cross‑functional engagement and started to align remuneration, product governance and vulnerability frameworks with Duty expectations. The regulator also saw examples of firms acting on MI insights to simplify communications, refine fair value assessments and address friction in key customer journeys.

However, the review highlights inconsistent quality and depth of analysis. In some cases, reports summarised activity rather than evidencing outcomes, with limited use of customer‑level data, benchmarks or cohort analysis to test fairness across different groups, including vulnerable customers. Fair value assessments were sometimes backward‑looking and overly reliant on averages, without clear linkage between costs, benefits and outcomes. Where harms were identified, remediation plans were not always time‑bound, measurable or resourced. The FCA also found weak challenge by Boards when MI lacked granularity, and instances where third‑party and distribution chain oversight did not evidence adequate control of end‑customer outcomes.

The FCA expects 2026 reports to demonstrate clearer lines of accountability, sharper outcome testing and stronger Board challenge. Firms should ensure that MI is relevant, reliable and sufficiently granular to detect outliers and distributional impacts, that fair value conclusions are justified by evidence, and that remedial actions are specific, dated and tracked to completion. Boards should interrogate drivers of poor outcomes, require scenario and cohort analysis, and evidence how insight has led to product, pricing or service changes. Oversight of outsourced and Appointed Representative arrangements should explicitly cover outcomes and data rights to monitor them.

In practical terms, firms should refresh MI suites to close known gaps, strengthen fair value methodologies, and align Board reporting cycles to ensure timely scrutiny of emerging risks. Training for senior managers and non‑executive directors should emphasise effective challenge and the use of customer outcome data in decision‑making. Where root‑cause issues are identified, firms should document the rationale for chosen remedies and monitor post‑implementation impact.

The direction of travel is clear: the FCA will judge compliance by evidence of good outcomes, not process alone. Firms that treat the Board report as a living tool for governance, challenge and continuous improvement will be best placed to meet supervisory expectations over the coming year.

How we can assist

If your firm needs assistance preparing its Consumer Duty Board report for the July 2026 deadline, we’re here to help. Our team offers expert guidance to ensure your report meets all regulatory requirements and effectively demonstrates compliance. Contact us today to learn how we can support your reporting needs.