Charlotte Clark, director of cross-cutting policy and strategy at the FCA, has reiterated what good practice looks like for outcomes monitoring under the Consumer Duty, why understanding the consumer experience matters, and where firms should focus.
Clark says the Consumer Duty was designed to ensure firms focus on the outcomes that matter to their customers, but stresses that understanding these outcomes "is about more than collecting data or producing reports".
"It helps firms identify where customers may be struggling, spot emerging risks and take action before harm occurs", she said, adding that "doing this well helps build consumer trust in the firms and products that they engage with".
The FCA found that the strongest firms have structured, evidence-based monitoring frameworks that define good outcomes, track customer journeys, and use measurable indicators to identify risks and drive improvements. These firms clearly link the information they collect to decisions and actions, while regularly assessing whether interventions are effective. Smaller firms can also achieve this with proportionate, risk-based approaches.
However, some firms still rely on high-level or reactive monitoring that fails to identify poor outcomes, understand their causes, or take appropriate action.
The FCA also highlighted the importance of monitoring outcomes across third parties and distribution chains, ensuring firms have sufficient oversight of the full customer experience. Governance has improved, with stronger board engagement, but firms should provide clearer evidence of challenge, scrutiny, and decision-making.
Overall, the most effective firms focus on results rather than activity. They identify issues early, understand their causes, implement improvements, and measure whether those actions have led to better customer outcomes.
Clark says the strongest examples the FCA reviewed "don't just show what they monitored... they show what happened as a result".
"They can identify an issue, understand its cause, take action and then assess whether that action improved outcomes for customers", she added.
In conclusion, Clark said: "As firms continue embedding the Duty, they should consider whether their monitoring gives them a clear enough view of customer outcomes and whether it leads to timely, effective action.
"The firms making the strongest progress aren't necessarily collecting more information. They're using it more effectively to understand their customers, identify harm earlier and drive meaningful improvements."
Toni Hatton, head of compliance at The Exeter, commented: “Three years on from the introduction of Consumer Duty, the focus has rightly shifted from implementation to demonstrating meaningful outcomes for members. The Duty has encouraged firms to think differently about how products are designed, communicated and supported, with fair value and good customer outcomes remaining at the heart of those decisions. It has also helped strengthen the industry's focus on understanding customer needs, identifying potential harm and ensuring support is available throughout the customer journey.
“The sector has made significant progress in adapting products, services and communications for vulnerable customers, and that focus has rightly broadened to delivering consistently good outcomes across all clients, members or consumers.
“As a mutual, putting members first has always shaped our approach, so over the past three years Consumer Duty has reinforced principles we have long believed in. The priority now is to continue learning from data, customer insight and adviser feedback, and to act where improvements are needed. Consumer needs and expectations continue to evolve, and so must firms. Delivering good consumer outcomes is an ongoing commitment to continuous improvement, not a one-off exercise.
“Success will ultimately be measured not by compliance with the rules themselves, but by the demonstrable difference firms make to consumer outcomes.”
