Recent Developments for UK PLCs — March 2025

FCA Criminal Enforcement Actions Expected to Continue, but Potentially More Discreetly, in 2025

On 6 February 2025, the House of Lords Financial Services Regulation Committee published a report titled “Naming and shaming: how not to regulate”. The report highlighted the Committee’s concerns with the FCA’s (revised) proposals on publicising enforcement investigations:

• The report found that the FCA failed to make a convincing case for its proposals and exercised poor judgement regarding the likely industry response — resulting in widespread industry backlash.
• The Committee remained unconvinced that the FCA’s proposed new public interest framework strikes an acceptable balance between realising the potential benefits to consumer protection and transparency, and managing the potential risks to firms, individuals, and market stability.
• The report highlights that the FCA’s proposals may expose firms to significant reputational damage before the facts of the case have been established. The Committee took the view that the proposals risk positioning the UK as an international outlier in a manner that would be misaligned with the FCA’s secondary competitiveness and growth objective.

The report concluded that the FCA needs to demonstrate that key concerns raised in the consultation feedback have been addressed, and that any future action and decision-making on enforcement by the FCA will be proportionate and clearly evidenced. The Committee considered that, if the FCA cannot find an acceptable balance, the FCA should not proceed with its proposals.

Although the report refers to firms, the FCA’s proposals also affect listed companies that are not regulated as financial services firms. The FCA’s consultation on its proposals closed on 17 February 2025, and the FCA board is due to make a decision in Q1 2025.

The Committee’s report was published following a period of increased use of criminal prosecution powers. This increase in criminal enforcement activity is reflected in the FCA’s latest Annual Report and Accounts, which includes FCA Enforcement data from April 2023 to March 2024:

• Enforcement operations: As of 31 March 2024, there were 188 ongoing enforcement operations, with 86 involving criminal or dual-track investigations (i.e., addressing both regulatory and criminal breaches). Between April 2023 and March 2024, 25 new enforcement operations were initiated, 16 of which were criminal or dual-track.
• Charges: In 2023/24, the FCA charged 21 individuals with financial crime offences, marking the highest number of charges in any single year.
• Enforcement outcomes: In 2023/24, the FCA secured 11 criminal convictions, including two for insider dealing, compared to just one conviction in 2022/23. The FCA also secured two confiscation orders valued at £200,000, compared to none in 2022/23.

FTSE 350 to Increase Efforts to Promote Women to Senior Leadership Roles

On 25 February 2025, the FTSE Women Leaders Review published its latest report, which showed that women now occupy 43% of board roles and 35% of leadership roles at FTSE 350 companies. Both statistics represent a year-on-year increase from 2024.

However, fewer women were appointed to the most senior board and leadership roles (i.e., CEO, chair, SID, and finance director) than anticipated. The review noted that the increase in the number of women on executive committees is dominated by those in functional roles, such as HR, general counsel, company secretary, and chief information officer.

The review recommends the following:

• The voluntary target for FTSE 350 boards, and for FTSE 350 leadership teams, should be increased to a minimum of 40% (from 33%) women’s representation by the end of 2025.
• FTSE 350 companies should have at least one woman in the chair or SID role, and/or one woman in the CEO or finance director role, by the end of 2025.

T+1 Settlement to Take Effect in the UK on 11 October 2027

On 6 February 2025, the Accelerated Settlement Taskforce (AST) published its final report outlining the key technical and operational recommendations for the UK’s move to T+1, which will take effect on 11 October 2027. The EU and Switzerland are also expected to move to T+1 in October 2027. The report’s recommendations have been endorsed by the UK government alongside the Bank of England and the FCA.

Market participants conducting securities settlement in the UK should review the AST’s recommendations and determine what is required to move to a T+1 settlement cycle. This can include budget considerations, operational systems changes and testing, agreements with third-party providers, and counterparty arrangements.

The FCA has launched a webpage dedicated to the UK’s move to T+1 settlement containing further information for regulated firms.