No matter the size or complexity of your business, you should have a Business Continuity Plan (BCP) which is fit for purpose to ensure you can maintain business as usual should anything unexpected happen.
These disruptive circumstances can range from an IT system failure to the loss of key staff, requiring people to work from home or from another site, as many businesses have had to do during the Coronavirus pandemic.
SYSC 3.2.19 states: “A firm, should have in place appropriate arrangements, having regard to the nature, scale and complexity of its business, to ensure that it can continue to function and meet its regulatory obligations in the event of unforeseen interruption. These arrangements should be regularly updated and tested to ensure their effectiveness.”
That means you should also have a Business Impact Analysis (BIA), which will help your Senior Management to identify critical processes or services to maintain day-to-day practises. Examples could include:
- Maintaining customer renewals
- Handling client money
- RMAR reporting.
Completing this review will also enable your Senior Management to understand what they should do to keep the business going during this critical time and assess the implications if your brokerage is without critical processes for a period of time.
Testing, as stated by the FCA, is crucial to ensure the plan is effective, and that it simply “does what it says on the tin”. Without any form of testing, a firm cannot be certain the plan would be work in an emergency.
Members can find a template BCP, which includes a BIA and stress testing examples, on the Broker Network Hub. Our Risk & Compliance team have recently revised the template to include home working in an emergency.
If you are using the document, it should be personalised to suit your individual firm’s requirements, reviewed at least annually by Senior Management and deemed fit for purpose.
If you have any questions and are a Premier Members, please contact your dedicated Risk & Compliance Consultant for assistance. If you are an Advantage Member, please get in touch with the Compliance Helpdesk on firstname.lastname@example.org or 01423 877839.
Not a member? Find out how you can benefit from critical Risk & Compliance support as part of your membership by emailing email@example.com.