How should firms interact with the FCA and other regulators?

Firms should interact with the FCA and other regulators in an open and cooperative way because this approach fosters trust and transparency. An open dialogue allows for better understanding of the regulatory requirements and expectations, enabling firms to align their practices accordingly. This cooperation is crucial for effective compliance management, as it helps firms to understand regulatory changes and provide the necessary information that may assist in the regulatory process. Engaging positively with regulators can also lead to more constructive feedback and support, ultimately benefiting the firm in managing risk and enhancing its reputation within the industry. This approach is in line with the principles of good governance and accountability that regulators expect from firms in order to maintain market integrity and protect stakeholders.

Firms that opt for confrontational tactics or avoid communication entirely may find themselves facing misunderstandings or compliance issues, which can lead to sanctions or reputational damage. Engaging only during audits does not support a proactive compliance culture, which is essential for ongoing regulatory adherence.