The FCA recently published CP26/9, building on the foundations set out in CP25/22 last year, as part of a broader programme of reform aimed at reshaping how firms identify, assess and remedy consumer harm. CP25/22 primarily focused on strengthening the effectiveness of complaints handling and redress frameworks, particularly around consistency, governance and the use of data. CP26/9 builds on this direction of travel by further emphasising earlier intervention, improved root cause analysis, and a more proactive approach to preventing consumer harm before it crystallises.
Taken together, they signal a clear regulatory intent to move the UK redress framework away from reactive, case-by-case remediation towards a more structured, earlier and more consistent approach to resolving issues when they arise. At the heart of these proposals is a recognition that the current system, whilst well-established, can be slow to respond when widespread issues emerge and can place significant operational strain on firms when large-scale remediation exercises are required. The FCA’s direction of travel therefore focuses on improving timeliness, consistency and the quality of decision-making across both complaints handling and redress activity.
A More Integrated Approach to Complaints and Redress
Rather than treating complaints handling and redress as separate disciplines, the FCA is increasingly positioning them as part of a single, connected lifecycle of consumer outcomes. Across both papers, the emphasis is on ensuring that firms can:
- Detect issues earlier through complaints intelligence
- Escalate emerging risks in a timely and structured way
- Analyse root causes, not just symptoms
- Translate insights into preventative action
- Deliver consistent and evidence-based redress decisions
This reflects a broader expectation that firms move towards continuous monitoring of conduct risk, rather than episodic remediation once harm has already crystallised.
Key Regulatory Themes
- Earlier intervention and prevention of harm
The FCA is increasingly focused on identifying patterns of detriment before they become systemic. This includes strengthening firms’ ability to:
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- Spot trends in complaints and operational data
- Identify potential systemic issues at an earlier stage
- Escalate concerns before they require formal remediation programmes
- Act decisively on early warning indicators
The underlying objective is to reduce the need for large, retrospective redress exercises.
- Consistency and fairness in outcomes
A recurring theme is variability in how redress is determined across the market. The FCA is seeking greater consistency while preserving proportionality and case-by-case judgement.
Areas of focus include:
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- Inconsistencies in compensation calculations between firms
- Variability in internal decision-making frameworks
- Differences in how similar complaints are assessed
- Lack of standardisation in certain redress methodologies
The expectation is not rigid uniformity, but greater transparency, structure and justification in how outcomes are reached.
- Root cause analysis and preventative controls
Firms are expected to move beyond addressing individual complaints and instead demonstrate a deeper understanding of underlying drivers of harm. This includes:
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- Identifying systemic process or product weaknesses
- Linking complaints trends to conduct risk frameworks
- Embedding lessons learned into product governance
- Demonstrating sustainable remediation, not just customer-level resolution
In practice, redress is increasingly viewed as part of a wider control environment rather than a standalone remediation activity.
- Data quality, governance and escalation
A significant focus is placed on the quality and use of complaints data. The FCA has highlighted that inconsistent classification and reporting can materially limit both internal oversight and supervisory effectiveness.
Key expectations include:
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- Improved accuracy and consistency of complaints categorisation
- Better-quality management information to support decision-making
- Clear escalation thresholds for material trends
- Stronger board and senior management oversight of emerging issues
- Treating complaints data as a core conduct risk indicator
Combined Regulatory Direction
When viewed together, CP26/9 and CP25/22 reinforce a single, coherent direction of travel. The FCA is moving towards a model where:
- Complaints data feeds directly into conduct risk monitoring
- Root cause analysis drives preventative action
- Redress becomes more structured, consistent and earlier in the lifecycle
- Governance frameworks support continuous oversight rather than periodic review
This represents a subtle but important shift away from reactive remediation towards embedded, ongoing risk management.
Implications for Firms
For firms, the evolving expectations will require a more joined-up operating model across complaints, conduct risk and remediation functions. In particular, firms will need to strengthen:
- Integration between complaints handling and redress processes
- Data infrastructure and analytics capabilities
- Governance frameworks and escalation routes
- Documentation of decision-making and redress rationale
- Senior management visibility of emerging risks
Operationally, firms should expect increased scrutiny over:
- How consistently similar cases are treated
- Whether complaints trends are being identified early enough
- The robustness of root cause analysis
- The effectiveness of preventative actions taken
Over time, firms that can demonstrate early identification of issues, structured decision-making and strong governance oversight are likely to be better placed to manage both regulatory expectations and operational volatility.
How Complyport Can Help?
- Complaints Review Service: Complyport provides an independent complaint review service to support firms in meeting FCA and FOS expectations. We review individual complaints relating to UK regulated activities to ensure outcomes are fair, consistent and appropriately evidenced, and can also assist with the preparation of responses to FOS enquiries and Ombudsman referrals where required.
- Consumer Duty and Customer Outcomes: We support firms in embedding the Consumer Duty across their complaints handling, product governance and remediation frameworks so that it operates as a live and integrated control framework. This includes helping firms clearly define, measure and evidence good customer outcomes, and ensuring that complaints intelligence is effectively used to identify and address potential detriment at an early stage.
- Governance, Risk and Resilience: We work with firms to strengthen governance structures across complaints and redress functions, ensuring that escalation pathways are clear and that material trends are appropriately considered at senior management and board level. Our support includes enhancing root cause analysis methodologies so that firms can better identify systemic issues and embed sustainable remediation within their control frameworks.
Contact Us
To discuss how the FCA’s evolving expectations on complaints handling, redress and data-led supervision may impact your business, speak to one of our experts.
Alternatively, explore our Virtual Compliance Assistant: https://vica.chat
