Central Bank publishes guidance on individual accountability framework
The Central Bank has issued regulations and guidance to firms on the new individual accountability framework (IAF).
The guidance follows a three-month consultation on the implementation of the Central Bank (Individual Accountability Framework) Act 2022.
It provides clarity regarding the Central Bank’s expectations for the implementation of three aspects of the framework: the senior executive accountability framework (SEAR), the conduct standards and certain aspects of the enhancements to the fitness and probity regime.
Derville Rowland, deputy governor of the Central Bank, said: “This piece of regulation is first and foremost about enhancing governance, performance and accountability in financial services.
“Today’s publications provide clarity to firms and individuals by setting out clearly the good practices expected of firms and role-holders, and their accountabilities.
“At its core, financial regulation is about supporting positive outcomes, protecting consumers and investors, and, ultimately, contributing to the economic well-being of the community as a whole. These regulations support this objective.”
She added: “We’ve been pleased by the in-depth engagement with this consultation process, having received a high volume of submissions from industry, as well as engaging directly with many stakeholders at several Central Bank-hosted events.
“As regulators, our approach to implementation of the framework will be founded on the principles of proportionality, predictability and reasonable expectations, underpinned by effective enforcement.
“The conduct standards and enhancements to the fitness and probity regime are set out in legislation and will become applicable on 29 December 2023.
“Our consultation has confirmed that SEAR Regulations that describe responsibilities of specific roles and requirements of firms will apply to in-scope firms from 1 July 2024 and to (independent) non-executive directors at in-scope firms from 1 July 2025.
“This allows industry a transition period to meet their obligations.”