FCA interventions aim to boost UK investment culture: implications and support for firms
Arguably there are several long-standing issues with the investment culture in the UK. Many consumers remain in cash when it might not be in their best interests, others are disengaged from their pensions and investments, and a growing number have been drawn to higher-risk, speculative products without necessarily understanding the risks involved.
The Financial Conduct Authority (FCA) aims to address this through a package of reforms designed to encourage a healthier, more engaged investment culture across the UK. Its recent publications include, confirmation of the new Consumer Composite Investments (CCI) disclosure regime, a consultation to overhaul the client classification rules, and a discussion paper on key elements of the regulatory framework for retail investors.
The policy package at a glance
The FCA’s new CCI disclosure regime is the UK’s post-Brexit replacement for EU-derived disclosure frameworks. The new regime moves away from complex, standardised templates and introduces a more flexible disclosure model aimed at enhancing investor understanding.
The new requirements aim to improve consumer comprehension of returns, risks and costs, allowing firms to innovate communication with customers without diluting standards. The optional transition begins on April 6, 2026, with manufacturers able to choose between a concise product summary or follow the existing disclosure requirements during the transition period. Full compliance with the new regime becomes mandatory from April 6, 2027.
The FCA is also consulting to update its COBS client classification requirements, with the aim of giving firms more flexibility to deal with wealthy and experienced investors as professional clients. The FCA is aiming to remove one of the challenges firms have faced in demonstrating how an investor meets the thresholds for categorisation as a professional rather than a retail investor, while ensuring firms undertake and document a robust assessment of how clients meet the new requirements. The paper also addresses conflicts of interest, proposing a more proportionate and streamlined approach to managing these obligations without reducing core protections.
An additional FCA discussion paper (DP25/3) is seeking views on how regulation can help expand consumer access to investments. The FCA is looking to remove regulatory barriers to consumers investing appropriately, whilst intervening to prevent harm from scams and inappropriate high-risk investments. The scope of the paper is broad and covers a diverse range of topics. These include key parts of the regulatory framework such as product classification, financial promotions, appropriateness, as well as particular products and services such as model portfolio services, trading apps, fractional shares and speculative investments.
Immediate Actions for Firms: Operational, Conduct and Governance
Disclosure, design and governance: under the new CCI regime, product managers and distributors must refresh disclosure strategies, content standards and approve workflows. Flexible summaries should be designed using evidence of consumer understanding and behavioural insights. Boards and product Governance Committees should set thresholds for clarity, fairness and comparability, aligned to the Consumer Duty
Management information: firms need MI which captures consumer comprehension- such as complaint themes, confusion points and read time. This will evidence compliance and improve customer experience processes.
Cross-border compliance: EU firms operating in the UK must adapt to UK-specific requirements under CCI. UK firms distributing into the EU must maintain dual compliance or ring-fence documentation by market.
Potential Future Actions for Firms: Operational, Conduct and Governance
Client classification: if CP25/36 proposals are adopted, firms engaging with professional clients will need robust onboarding and periodic reassessment processes to verify wealth thresholds, experience credentials and informed consent. Best practice in this case would include record-keeping, rationale documentation and audit trails demonstrating proportionate application of protections.
Governance enhancements: future rules may require firms to integrate classification, disclosure, MI and Governance into a single cross-functional programme to avoid operational fragmentation.
Disclosure drift- flexibility should not compromise neutrality. Firms should ensure disclosures present potential returns, costs and risks in a fair, balanced and evidence-based manner, avoiding promotional bias. Avoiding:
Inadequate testing: firms risk breaches of Consumer Duty and poor customer outcomes without evidence of comprehension
Misclassification: weak onboarding and consent processes will expose firms to regulatory action
Operational fragmentation: firms should treat disclosure, classification, management information and governance as a single, cross-functional programme
How can Ocorian support you?
Consultations on classification and risk appetite run into Q1 2026, with the broader discussion paper closing in early March 2026. Firms are encouraged to respond with evidence and operational evidence.
From April 6, 2026, manufacturers can begin using product summaries under CCI. A staged approach- pilot, measure, refine- will allow firms to manage conduct risk whilst building internal capability.
Ocorian can advise on several items based on this regulatory update:
On client classification frameworks, implementing policy, procedures and checklists for professional client onboarding.
We can develop UK/EU twin-track documentation strategies, minimising duplication whilst maintaining regulatory compliance.
Conducting a gap analysis across current PRIIPs/UCITS, prioritising products with the highest retail penetration or complaint rates.
Review existing professional client onboarding and review controls, defining effective thresholds and evidence standards.
Build out management information to track understanding and outcomes, setting triggers for remedial actions.
Submit consultation feedback informed by operational realities.
If you would like to discuss how we can help you, please do contact us or speak to the team direct:
Michael Lawrence | Consulting Lead | Ocorian
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