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Everything you need to know about management responsibilities maps

If your firm is required to maintain a management responsibilities map, here’s what you need to know…

Broadly, the requirement to create and maintain a management responsibilities map applies to banks, insurance firms, and enhanced scope firms.[1]

In-scope firms must AT ALL TIMES, have a comprehensive and up-to-date management responsibilities map.[2]

A management responsibilities map is designed to help the firm and the FCA satisfy themselves that the firm has a clear organisational structure and to help the FCA to identify who is (or will be) accountable for a particular issue.[3]

Management responsibilities maps must include:

  1. details of reporting lines and lines of responsibility[4],
  2. reasonable details about the persons who are part of the chain of responsibilities (and their responsibilities),[5]
  3. all the names of the firm’s approved persons, governing body, senior management and senior personnel (as well as summary[6] details of the responsibilities which they hold)[7],
  4. all responsibilities described in any current statement of responsibilities[8],
  5. details of the management and governance arrangements relating to Prescribed Responsibilities (including the identity of the persons to whom those functions are allocated)[9].  This is not relevant to EEA SMCR firms[10],
  6. the reasons why Prescribed Responsibilities have been allocated to more than one person jointly or divided between different persons (if relevant),
  7. details about the allocation of responsibilities under SFM18 (other overall responsibility) and SMF 22 (other local responsibility),
  8. matters reserved to the governing body,
  9. details of how the firm’s management and governance arrangements fit together with its group,
  10. details of the extent to which the firm’s management and governance arrangements are provided by, or shared with, other members of its group or others.

A management responsibilities map must show clearly how any responsibilities are shared or divided between different persons.[11]

If senior management functions have been allocated to more than one person (or are performed by more than one person), a management responsibilities map must give details of how those responsibilities are performed by the individuals in question.[12]

Enhanced scope firms need only include management and governance arrangements to the extent that they relate to regulated activities[13] (but must provide sufficient information about non-regulated activities to show how the regulated activities fit with the firm’s management and governance arrangements as a whole).[14]

Support functions that should be included in any management responsibilities map include human resources, IT, compliance and legal.[15]

Management responsibilities maps should be consistent with Statements of Responsibilities.[16]  Both should make it simple to see how responsibilities fit into the overall system of management and governance of a firm.[17]

Management responsibilities maps should demonstrate that there are no gaps in the allocation of responsibilities among management.[18]

Management responsibilities maps should include a checklist confirming that all Prescribed Responsibilities have been allocated or, if not, why not.[19]

A management responsibilities map must be a single document[20] (in the sense that it should be self-contained)[21].  However, this doesn’t mean that it needs to be a single sheet of paper – it can be made up of a folder (which can be electronic) with several files or items in it.[22]

The FCA expects that the management responsibilities map of a small and non-complex firm is likely to be simple and short.  It may be no more than a single sheet of paper.[23]

An in-scope overseas branch should draft its management responsibilities map as if the rest of the firm outside of the UK branch were a separate company in its group.[24]

Firms should consider past versions of their management responsibilities maps as an important part of their records and as an important resource for the FCA in supervising the firm.[25]

Firms must maintain past versions of a management responsibilities map for 6 years (in the case of large non-Solvency II insurers) and for 10 years (in all other cases) from the date on which it was superseded by a more up-to-date version.[26]

Firms must be prepared to provide each version of their management responsibilities maps to the FCA on request.[27]

[1] SYSC 25.1.1R

[2] SYSC 25.2.1R

[3] SYSC 25.1.6G

[4] SYSC 25.2.1R and SYSC 25.2.3R

[5] SYSC 25.2.1R

[6] SYSC 25.4.5G

[7] SYSC 25.2.3R

[8] SYSC 25.2.3R

[9] SYSC 25.2.3R

[10] SYSC 25.6.4G

[11] SYSC 25.2.2R

[12] SYSC 25.4.10G

[13] SYSC 25.3.1R

[14] SYSC 25.3.2R

[15] SYSC 25.3.3G

[16] SYSC 25.4.1G

[17] SYSC 25.4.2G

[18] SYSC 25.4.4G

[19] SYSC 25.4.9G

[20] SYSC 2.5.1R

[21] SYSC 25.5.2G(3)

[22] SYSC 25.5.2G

[23] SYSC 25.4.14G

[24] SYSC 25.4.13G

[25] SYSC 25.8.1G

[26] SYSC 25.8.3R

[27] SYSC 25.8.3R