Principles matter, FSA says, but winning over hearts and minds may prove difficult
LONDON – John Humphrys, conference chair and presenter of BBC Radio 4's Today programme, rightly dubbed the Financial Service Authority's (FSA) move to more principles-based regulation (MPBR) as the most significant development in this area for 10 years. The majority of the 700 delegate-strong audience at an FSA-organised event in early May appeared to agree with him for the most part, but winning over hearts as well as minds may well be an uphill struggle.
"In essence, it [principles-based regulation] is about regulating with the emphasis on principles and high-level rules, not prescription of processes; it relies on setting out the outcomes we want to see achieved in the financial services market and then directing our supervision to assessing how they are being achieved. This is a direction of travel, not a project to be implemented by a specific date… It's a strategic direction that we are convinced is necessary to deliver our statutory
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