The FCA has published its final guidance to all firms on how to address non-financial misconduct. The guidance follows its decision to align the rules on NFM for banks and non-banks, when it made changes that take effect in September 2026. At that time, it asked firms whether guidance would be useful, and they overwhelmingly said it would. The guidance amends COCON to explain how NFM can be a breach of conduct rules. The FCA also explains how NFM forms part of the Fit and Proper Test.
Among other things, the guidance:
- clarifies that the COCON rules apply only to conduct relating to a function carried out by the relevant staff member where that conduct relates to the carrying on of an activity of the firm – so it applies to regulated and unregulated activities alike, but not to an employee’s private or personal life. However senior staff should still disclose any information about their life outside work if it may be material to a fitness assessment;
- gives examples of when conduct is likely to be within scope, but says each assessment should be done on case-by-case basis;
- clarifies that conduct may be within scope even if a firm has not authorised or has forbidden it;
- gives specific guidance on examples of conduct that might breach individual conduct rules;
- sets out factors to help determine how serious the misconduct is;
- includes an annex on how COCON applies to harassment;
- explains the territorial scope of the rules; and
- explains how a breach of COCON can be relevant to an F&P assessment including how conduct in personal life might be relevant.