Non-financial misconduct is any behaviour that goes against the values and principles of an organisation, and that has the potential to cause harm to individuals or the reputation of the organisation. This type of misconduct can take many forms, including harassment, discrimination, bullying, and even physical violence. While non-financial misconduct may not have a direct financial impact on an organisation, it can have serious consequences for the wellbeing of its employees, customers, and stakeholders.
The FCA has been taking a proactive approach to non-financial misconduct in recent years. In 2019, it published a discussion paper on the topic, which highlighted the risks associated with non-financial misconduct and proposed a number of measures to prevent and address it. The FCA has also made it clear that it expects firms to take responsibility for preventing and addressing non-financial misconduct, and that it will take action against firms that fail to do so.
One of the key challenges with non-financial misconduct is that it often goes unreported. Victims may fear retaliation, may not be aware of their rights, or may feel that their concerns will not be taken seriously. The FCA has recognised this issue and has called on firms to create a culture where employees feel safe to raise concerns and where those concerns are taken seriously and dealt with appropriately.