The Senior Executive Accountability Regime (SEAR)
Knowing where to start preparing for SEAR is daunting. Let our compliance experts streamline the process for you.
Following enactment of the Central Bank (Individual Accountability Framework) Bill 2022 on 9 March, on 13 March 2023, the Central Bank of Ireland (CBI) launched a three-month public consultation paper (CP153) including draft regulations and draft guidance on the key aspects of the implementation of the Senior Executive Accountability Regime (SEAR).
Who does the SEAR apply to?
- Investment firms which deal on own account or place instruments of firm commitment basis or are authorised to hold client money (or both)
- Third country branches of the above
- Credit institutions (but not credit unions)
- Insurance undertakings (excluding reinsurance undertakings)
In addition to SEAR, the IAF includes the following key elements:
- Conduct Standards: Common Conduct Standards are basic standards such as acting with honesty and integrity, with due skill, care and diligence, and in the best interest of customers, and will apply to individuals in all regulated firms. Senior executives will also have Additional Conduct Standards related to running the part of the business for which they are responsible.
- Enhancements to the current Fitness & Probity (F&P) Regime: This will include clarifying firms’ obligations to proactively certify that individuals carrying out certain specified functions are fit and proper.
- Amendments to the Administrative Sanctions Procedure (ASP): A key change will be the Central Bank’s ability to take enforcement action under the ASP directly against individuals for breaches of their obligations rather than only for their participation in breaches committed by a firm.
The Consultation Paper sets out the following implementation timelines:
- By 31 December 2023, all firms must comply with the conduct standards and enhanced fitness and probity regime.
- By 1 July 2024, all in scope firms must comply with the regulations on inherent and prescribed responsibilities and other SEAR requirements including the development of Statements of Responsibilities and Management Responsibility Maps, examples of both have been provided in the consultation paper.
How can we help?
We have extensive experience in assisting clients with the implementation of individual accountability regimes, especially the SMCR upon which the IAF is closely modelled. We are supporting clients by offering a range of services and programme accelerators to help firms meet their obligations on time:
- SEAR toolkit
- Responsibilities mapping support
- Fit and proper assessments
- Senior executive training and workshops, including Duty of Responsibility
- Conduct breach escalation, management, internal and external reporting support
- Development of a compliance monitoring program
Contact us today to find out how we can help you meet your SEAR obligations in a fast and effective way, ahead of the upcoming deadline.
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