Consumer Duty was never just a compliance exercise. When it came into force in July 2023, the aim was clear: to move firms beyond minimum standards and tick-box compliance towards a genuine, evidenced commitment to good customer outcomes. Firms were given time to prepare. That time is up.

The FCA’s April 2026 observations on year 2 board reports made the message unmistakable: firms have had sufficient time to embed the Duty, and the regulator now expects evidence of real progress, not a refreshed version of last year’s report with updated numbers. The rules have not fundamentally changed. The FCA’s tolerance for paper frameworks has.

What is the Consumer Duty evidence gap ?

Black’s Law Dictionary defines evidence as proof used to establish that something is true. In Consumer Duty terms, assertion is not proof. Firms must be able to show, through data, governance, MI, and culture, that the Duty is working in practice.

At fscom, we call the gap between assertion and proof the evidence gap, the space between what firms say about Consumer Duty and what their data, governance, and customer outcomes actually demonstrate. Closing that gap through a clear-eyed assessment of compliance maturity is one of the defining regulatory challenges of 2026.

Why the evidence gap exists

In most firms, the evidence gap is not about intent. Since 2023, firms have invested heavily in frameworks, training, policies, and Board reporting. The challenge now is whether those foundations can be translated into consistent, outcomes-focused evidence.

The FCA’s observations suggest that many board reports still present large volumes of MI without clearly explaining what that information says about customer outcomes. We see the same in practice. In one recent engagement, the building blocks were in place, but they had developed in a fragmented way. The result was a limited ability to evidence outcomes consistently or give the Board a clear end-to-end view.

The evidence gap is not just a reporting issue. It is an ownership issue. In less mature firms, Consumer Duty is treated as a compliance exercise and the board report as a paper to produce. The result is predictable: the Duty is managed rather than owned, and the report is produced rather than debated.

That is not just a compliance failing. It is a Board-level ownership and governance issue. For Boards, this is not a compliance report. It is a business outcomes report. The question is not whether the framework is compliant, but whether the firm can show good outcomes are being delivered.

What the FCA expects in 2026

Taken together, the FCA’s April 2026 commentary, its March 2026 publication on consumer understanding, and its wider supervisory messaging point firms towards a small number of practical priorities.

To help firms assess whether their current reporting and governance arrangements align with these expectations, fscom has developed the following templates, updated for 2026:

These are designed to help boards challenge outcomes effectively, identify evidence gaps, and assess compliance maturity.

Consumer Duty is now part of mainstream supervision. In its March 2026 regulatory priorities report for the payments sector, the FCA identifies effective implementation of the Duty as a core sector priority, with focus on pricing transparency in international payments and the treatment of consumers in vulnerable circumstances.

 

Four areas firms should focus on

Evidence Board challenge

The FCA expects Boards to do more than receive the annual report. They should review it critically, challenge the conclusions, test whether the evidence is sufficient, and hold management to account for gaps and follow-up actions. Minutes, actions and escalation records should show that challenge clearly.

This is a common tension. The business may feel the Board is not challenging enough, while the Board may feel it is not receiving clear, outcomes-focused information. The weakness is often MI quality, ownership, and escalation leaving the Board accountable without sufficient visibility.

Culture is also visible in whether staff can speak up safely, whether whistleblowing themes are reported and acted on, and whether concerns are escalated early enough to prevent poor customer outcomes from becoming systemic.

Link data to outcomes

Boards need more than dashboards and KPI summaries. Reports should explain what the data says about customer experience, include clearer root-cause analysis and segmentation, and lead to concrete actions.

Focus on consumer understanding

The FCA’s March 2026 publication makes clear that firms should not rely on superficial indicators alone. They should use a broader mix of evidence including feedback, complaints, call listening, website analytics, drop-off data, and testing to assess whether communications actually help customers make effective, timely, and informed decisions.

Translate vulnerability expectations into practice

The FCA’s focus on vulnerable circumstances is becoming more nuanced. Recent publications make clear that vulnerability is complex, evolving, and often situational. Firms are expected to identify needs early, adapt communications, build accessibility into customer journeys, and monitor outcomes in practice. That is particularly challenging in payments and B2B2C models, where firms may have limited direct customer interaction. AI and transaction monitoring may help identify patterns of vulnerability. However, incomplete data and fragmented MI still limit what many firms can evidence with confidence.

The maturity shift: what to do now

Underlying all of this is a broader shift in regulatory posture. The FCA is no longer judging firms by whether the right structures exist on paper, but by whether they work in practice; producing insight, informing decisions, and improving outcomes. This is what compliance maturity looks like in practice.

That same thinking is reflected in fscom’s updated board report template, and Consumer Duty Board Assessment Template, both of which have been refreshed for 2026. The templates place greater emphasis on Board challenge, evidenced culture, ownership, governance, MI limitations, and compliance maturity.

Used together, they help firms move beyond reporting activity and towards evidencing outcomes.

If you are preparing your 2026 board report, start with the MI limitations section. If you cannot explain where the gaps are and what is being done to close them, the FCA is likely to view that as a maturity issue, not a strength.

With the next reporting cycle approaching, firms should assess honestly where they sit on the maturity curve against the FCA’s current expectations. Boards and senior leaders should ask the following.

  • Can we explain, with evidence, where outcomes are good, where they are mixed, and where they are weak?
  • Does our MI give the Board a clear view of customer outcomes, segmented risks, and the limits of our data?
  • Is Consumer Duty genuinely owned across the business, with clear accountability beyond Compliance?
  • Can we show how consumer understanding, vulnerability, and foreseeable harm are being assessed and acted on in practice?
  • Can we demonstrate that good outcomes are being delivered or are we just asserting it?

How fscom can help

fscom helps firms strengthen Consumer Duty reporting, close evidence gaps, and improve compliance maturity.

Our updated 2026 Consumer Duty board report template and Consumer Duty board assessment template are designed to help boards challenge outcomes effectively, assess governance maturity, and identify areas requiring further evidence or enhancement.

To discuss your firm’s readiness for the 2026 reporting cycle, get in touch.