SM&CR Responsibilities Map: Governance Framework for Clear Accountability

What It Is

The SM&CR responsibilities map is a firm-level governance document required under SYSC 26 for enhanced firms and recommended as best practice for all FCA-authorised firms. It provides a comprehensive, visual representation of how management responsibilities are allocated across the firm's senior leadership, ensuring that every area of the firm's regulated activities has a named individual who is accountable.

The map must show the allocation of all prescribed responsibilities — the specific responsibilities that the FCA mandates must be held by a Senior Manager — as well as the firm's overall management responsibilities, reporting lines, and governance structure. It is not simply an organisation chart. An organisation chart shows who reports to whom; a responsibilities map shows who is accountable for what. The distinction matters because the FCA uses the map to trace accountability when things go wrong.

The responsibilities map works in conjunction with individual Statements of Responsibilities (SoRs), which set out each Senior Manager's personal accountabilities in detail. The map provides the holistic, firm-wide view; the SoRs provide the granular, individual detail. Together, they form the accountability infrastructure that the FCA relies on to hold individuals to account under the duty of responsibility set out in section 66B of FSMA 2000.

For enhanced firms, the responsibilities map is a regulatory requirement, not optional good practice. The FCA expects it to be a living document that is updated promptly whenever the firm's management structure changes. For core firms, while not mandated, producing and maintaining a responsibilities map demonstrates governance maturity and provides a structured framework for ensuring that SM&CR obligations are properly discharged.

Why the FCA Cares

The FCA created SM&CR because the Approved Persons Regime failed to deliver individual accountability. One of the most persistent problems the regulator encountered was diffusion of responsibility — when things went wrong, no single person could be identified as accountable because responsibilities were vaguely defined, overlapping, or simply undocumented. The responsibilities map exists to eliminate this problem.

The regulator uses the responsibilities map as its starting point for enforcement investigations. When a compliance failure, conduct breach, or customer harm event occurs, the FCA's first question is: who was responsible for this area? The responsibilities map should provide an unambiguous answer. If it does not — because of gaps, overlaps, or stale documentation — the FCA treats this as a governance failure in its own right, compounding whatever substantive breach prompted the investigation.

The FCA has published enforcement outcomes that specifically reference inadequate responsibilities mapping. In its 2024 SM&CR lessons learned publication, the regulator highlighted cases where firms' responsibilities maps bore little resemblance to actual management structures, where prescribed responsibilities were allocated to individuals who lacked the authority or information to discharge them, and where departures created accountability vacuums that persisted for months.

The FCA also uses responsibilities maps proactively during supervisory assessments. When conducting a firm visit, reviewing an application for variation of permission, or assessing a firm's readiness for new regulatory requirements (such as Consumer Duty), the regulator will examine the responsibilities map to understand whether governance is fit for purpose. A clear, current, well-maintained map is evidence of governance competence; a stale, generic, or incomplete map triggers deeper supervisory scrutiny.

Who It Affects

The formal requirement to produce a responsibilities map applies to enhanced firms under SYSC 26. Enhanced firm status is triggered by meeting specified criteria, including but not limited to: total intermediary regulated business revenue exceeding GBP 35 million, assets under management exceeding GBP 15 billion, or having more than a specified number of approved persons. Most large wealth managers, insurance companies, and sizeable broker groups fall into the enhanced category.

Core firms — which represent the majority of FCA-authorised firms, including most IFAs, small insurance brokers, consumer credit firms, and payment services firms — are not required to produce a responsibilities map. However, they remain subject to the underlying SM&CR obligations: allocating prescribed responsibilities, maintaining Statements of Responsibilities, and ensuring clear accountability. In practice, producing a responsibilities map is the most effective way to demonstrate compliance with these obligations, which is why the FCA recommends it regardless of firm category.

Limited scope firms (solo-regulated firms that only carry on insurance distribution activities that do not involve holding client money) have the lightest SM&CR obligations but must still allocate prescribed responsibilities appropriately.

The responsibilities map also has implications beyond the firm's own senior management. Where a firm uses appointed representatives, the map should show how oversight of AR activity is allocated to named Senior Managers. The FCA's 2024 portfolio strategy letter on appointed representatives made clear that principal firms' SM&CR arrangements for AR oversight will be a supervisory priority. Firms that cannot demonstrate clear accountability for AR conduct through their responsibilities map are exposed.

What Firms Get Wrong

The most fundamental error is treating the responsibilities map as a one-off implementation document. Firms produce a map when they first implement SM&CR, file it, and never update it. Organisational changes occur — people leave, new roles are created, business lines are launched or closed, regulatory permissions change — but the map remains frozen in its original state. When the FCA asks to see it, the document describes a firm that no longer exists.

The second common failure is confusing the responsibilities map with an organisation chart. An organisation chart shows reporting relationships; a responsibilities map shows accountability. A Senior Manager may have direct reports who handle operational tasks, but accountability for regulatory outcomes remains with the Senior Manager. Maps that simply replicate the org chart with job titles miss the point entirely.

Third, prescribed responsibilities are frequently misallocated. The FCA's prescribed responsibilities list (set out in SYSC 24.2 for enhanced firms and SYSC 25.2 for core firms) requires specific accountabilities to be held by named Senior Managers. Firms commonly allocate prescribed responsibilities to individuals who lack the seniority, authority, or information to discharge them effectively. For example, allocating compliance oversight (prescribed responsibility (j) for core firms) to a junior compliance officer who holds SMF16 on paper but has no real authority to challenge the business is not genuine allocation — it is cosmetic compliance.

Fourth, overlap and gap management is poor. The FCA expects every area of the firm's regulated activities to be covered by a named Senior Manager, with no gaps and no ambiguous overlaps. In practice, firms frequently have areas that fall between two Senior Managers' Statements of Responsibilities — particularly in cross-cutting functions like operational resilience, data protection, or outsourcing oversight — with neither individual clearly owning the responsibility. Equally, overlaps without clear delineation create confusion about who acts when issues arise.

Fifth, handover management during transitions is inadequate. When a Senior Manager departs, is suspended, or moves to a different role, there must be a documented handover that transfers accountability to a named successor. The FCA has identified cases where departures created accountability gaps lasting months, during which no Senior Manager was responsible for critical functions. Interim arrangements must be documented, time-limited, and communicated to the FCA where required.

What Evidence Is Expected

The FCA expects the responsibilities map to be a current, comprehensive document that can be produced on request and that accurately reflects the firm's actual management structure. For enhanced firms, this is a regulatory requirement under SYSC 26.5. For core firms, while the map itself is not mandated, the FCA expects equivalent clarity of accountability.

The map should clearly show all Senior Management Functions held within the firm, the individual holding each function, the allocation of every applicable prescribed responsibility to a named Senior Manager, and the firm's management and governance structure including committee structures and reporting lines. It should also identify any shared responsibilities (which should be rare and clearly justified), any interim or temporary arrangements, and the date of last review.

Individual Statements of Responsibilities must be consistent with the map. The FCA cross-references these documents and will identify discrepancies. Each SoR should clearly delineate the Senior Manager's responsibilities, the scope of their authority, and the boundaries of their accountability. Vague language — "assists with," "supports," "contributes to" — is insufficient. The SoR must state what the individual is accountable for, not what they help with.

The FCA also expects evidence that the map is actively maintained. This means version control, review dates, evidence of board or governing body approval, and a clear change management process. Board minutes or governance committee minutes should show that the map was discussed and approved, and that changes were made in response to organisational developments.

During supervisory visits, the FCA will test the map against reality. Supervisors will speak to Senior Managers and ask them to describe their responsibilities — and will compare the answers against what the map and SoRs say. Misalignment between what the individual says and what the documentation says is a significant finding.

Handover documentation should be available for any Senior Manager transitions that occurred in the preceding two years, showing what was transferred, to whom, the date of transfer, and any interim arrangements that were in place.

Good Implementation Looks Like

A firm with an effective responsibilities map treats it as a core governance document — on a par with its board terms of reference and its risk appetite statement. The map is reviewed at every board meeting where organisational changes are discussed, and a formal comprehensive review is conducted at least annually. The document has clear version control, and previous versions are retained for audit trail purposes.

Every prescribed responsibility is allocated to a single Senior Manager who has the seniority, authority, and access to information necessary to discharge it. The allocation is not ceremonial — the individual can articulate what the responsibility means in practice, what MI they review, what decisions they make, and how they evidence reasonable steps. Where a prescribed responsibility covers a cross-cutting area (such as the responsibility for the firm's performance of its obligations under the senior managers regime itself), the allocation is to a Senior Manager with genuine firmwide visibility.

The map identifies clear boundaries between Senior Managers' areas of accountability. Where responsibilities are adjacent — for example, the boundary between the head of compliance and the head of risk — the map specifies where one ends and the other begins. There are documented escalation protocols for issues that fall in boundary areas, ensuring that nothing falls between the cracks.

Transition management is proactive. When the firm knows a Senior Manager will depart, the handover process begins well before the departure date. The handover is documented and includes a briefing on current issues, pending actions, and any known risks within the outgoing Senior Manager's area. Interim arrangements are formally documented, time-limited (typically no more than 12 weeks), and communicated to the FCA where the departing individual held an SMF that requires regulatory notification.

The responsibilities map is linked to the firm's broader governance framework. Committee terms of reference reference the map, and committee membership reflects the Senior Manager with accountability for the relevant area. MI reporting flows align with accountability — the Senior Manager accountable for an area receives the MI for that area and can demonstrate that they review and act on it.

Related Tool

The MEMA SM&CR navigator provides a digital platform for creating, maintaining, and governing your responsibilities map. It maps all Senior Management Functions, prescribed responsibilities, and individual Statements of Responsibilities in a single integrated system, with automatic consistency checking to identify gaps, overlaps, and misalignments between the map and individual SoRs.

The tool includes a change management workflow: when an organisational change occurs — a new hire, a departure, a role change, or a restructure — the system prompts the required updates to the map and affected SoRs, generates the updated documents, and logs the change with full version history. Transition management is built in, with handover templates, interim arrangement documentation, and deadline tracking for FCA notifications.

Prescribed responsibility allocation is guided by the tool's built-in reference to the FCA's requirements for the firm's category (core or enhanced), ensuring that all mandatory responsibilities are allocated and flagging any that are unassigned. The tool generates the board-ready responsibilities map document and individual SoRs in a format that meets FCA expectations for supervisory review.

Related Service

Our SM&CR implementation service begins with a structural governance review. We assess your current responsibilities map (or build one from scratch for core firms), evaluate whether prescribed responsibilities are correctly allocated, review every Statement of Responsibilities for clarity and completeness, and test the map against your actual management structure through interviews with Senior Managers.

For firms undergoing organisational change — mergers, acquisitions, deauthorisations, or significant growth — we provide transition support. This includes redesigning the responsibilities map for the new structure, drafting updated SoRs, managing FCA notifications for SMF changes, and ensuring continuity of accountability throughout the transition period.

We also offer SM&CR health checks for firms preparing for supervisory visits or Section 166 reviews. We simulate the FCA's approach: testing Senior Managers' understanding of their responsibilities, cross-referencing documentation against practice, and identifying vulnerabilities that could attract regulatory criticism. Our consultants bring direct experience of how the FCA conducts SM&CR assessments and what findings typically trigger enforcement consideration.

Related Sectors

Consumer credit firms often have relatively simple management structures, but SM&CR compliance is no less important. The FCA has identified governance weaknesses in the consumer credit sector as a contributing factor to customer harm, particularly in high-cost credit and debt collection. Firms must ensure that the Senior Manager responsible for compliance oversight has genuine authority to challenge the business and that the individual holding the money laundering reporting officer function has appropriate independence.

Wealth management firms typically have the most complex responsibilities maps, with multiple Senior Managers across investment management, advice, operations, compliance, and risk. The key challenge is delineating accountability for investment suitability, client money oversight, and conflict management. The FCA has focused particular attention on whether wealth firms' SM&CR arrangements create genuine accountability for investment performance and suitability, or whether responsibility is so diffused that no individual can be held to account.

Insurance brokers face specific challenges around AR oversight. Where a broker operates an AR network, the responsibilities map must clearly show which Senior Manager is accountable for AR conduct, AR compliance monitoring, and AR complaint handling. The FCA's increasingly assertive stance on AR oversight means that brokers with unclear AR accountability in their responsibilities maps are at elevated regulatory risk.

Payment services firms and electronic money institutions, while often lean organisations, must maintain SM&CR arrangements that reflect the regulatory risks inherent in their business — particularly around safeguarding, fraud prevention, and AML. The FCA has highlighted concerns about governance maturity in the payments sector, and a well-maintained responsibilities map is one of the most visible indicators of governance quality that a supervisor can assess during initial engagement with a firm.