UK Financial Conduct Authority Shares Insights on Firms’ Preparations for Operational Resilience

The Financial Conduct Authority has set out its observations and insights on the preparations firms have made towards complying with its operational resilience rules ahead of March 31, 2025. The FCA expects firms to use these observations to review their approach and assess their readiness on the following key areas of the policy:

• important business services;
• impact tolerance;
• mapping and third parties;
• scenario testing;
• vulnerabilities and remediation;
• response and recovery plans; and
• governance and self-assessment.

The FCA highlights that ahead of the end of March deadline, firms must ensure they can remain within impact tolerance in severe but plausible scenarios for any identified important business services, and have their plans approved by their Board in good time. In addition, important business services, impact tolerances and mapping should be reviewed on at least an annual basis, or if there is a material change to business or the market in which the firm operates. Furthermore, the FCA notes that changes to important business services, impact tolerances, and mapping should be clearly identified in the firm's self-assessment, along with any rationale, and that scenario testing should become part of business as usual and be reviewed on a regular basis as evidence of firms' operational resilience.

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