The incoming chair of the Financial Conduct Authority said he hopes morale will improve at the regulator after an overhaul to pay and perks for staff hit morale.
Employees have blasted the markets watchdog’s leadership in a series of internal surveys, raising fears of increased staff turnover after sweeping changes to remuneration that included axing bonuses and moving to a performance-based pay model.
“The transformation programme is very important,” Ashley Alder told MPs on the Treasury Committee on 14 December. “I don’t think that was easy. It probably still isn’t easy, but the impression I get at the moment alongside quite a large measure of staff turnover is it now starting to come out at the other end of what inevitably seemed to be a painful era of change.”
“You can only hope that that can improve, without any doubt,” he added. “Optimistically, once the FCA has been through its reset of its pay deal, and once there is greater clarity about the way in which it is going to proceed… once there is a sufficient focus — they’re probably nearly there at the moment — on the consumer agenda, I would hope and expect that moral would increase once staff are very clear around the priorities around which they will align.”
Alder was appointed as the FCA’s new chair in July and is set to take over from interim incumbent Richard Lloyd on 20 February 2023. Alder confirmed to the MPs that he would be moving to the UK in the latter part of January.
The £170,000-role was advertised as two-to-three days a week job, but Alder told the committee he thought the role would require more commitment.
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Alder started in the City as an M&A lawyer at Herbert Smith and later became the firm’s head of Asia. He has been chief executive officer of the Securities and Futures Commission in Hong Kong since 2011.
He will join the regulator at a pivotal moment in its history, as the government places it front and centre of a sweeping set of reforms intended to free up the City for growth after Brexit.
Alder said that the FCA must have the resource in place to deal with its increased workload.
“The City’s position as a global financial centre, there’s a fair amount to unpack there. When it comes to the framework review and the [Financial Services and Markets Bill], that suggests the FCA will have a great deal of work to do,” he told the Treasury Committee. “There are opportunities and challenges, not least challenges around resourcing and ensuring the FCA’s resources are positioned in the right way to cover a pretty large waterfront, ranging from the City to replacing retained EU law to consumers.”
Alder has tried to become chief executive of the FCA on two previous occasions, losing out to now-Bank of England governor Andrew Bailey in 2016 and then to current FCA boss Nikhil Rathi two years ago.
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Parliament has the power to veto top appointments to the FCA, with the Treasury Committee making a recommendation to MPs ahead of a vote to formalise the posting. “Political sensitivity” was one of the skills identified in the adverts for the chair role.
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