The FCA has launched a consultation on plans to make serious bullying and harassment in financial firms a misconduct offence.

It plans to update its rules from 2026 to provide clearer guidance for regulated business on bullying and harassment in the workplace.

The regulator says it is taking steps to clarify its expectations on bullying, harassment and violence to "deepen trust" in financial services.

The watchdog says it aims to update its rules because previously it was often unclear when these types of behaviours would amount to a conduct rules breach in a firm other than a bank.

From 1 September 2026, the same rules that apply to banks will be extended to around 37,000 other regulated firms, increasing consistency across financial services, subject to consultation. 

The FCA said there has been widespread support for the FCA extending its rules in response to its previous consultation.

Serious, substantiated cases of poor personal behaviour will also need to be shared through regulatory references, in the same way financial misconduct currently is, making it harder for individuals to avoid consequences by moving from firm to firm, the FCA said.

Sarah Pritchard, the FCA's deputy chief executive, said the regulator had found "cultural failings" at some firms where bullying and harassment were often left unchallenged.

She said: "Too often when we see problems in the market, there are cultural failings in firms. Behaviour like bullying or harassment going unchallenged is one of the reddest flags – a culture where this occurs can raise questions about a firm's decision making and risk management. Our new rules will help drive consistency across industry and support the vast majority of firms that want to do the right thing to deepen trust in financial services."

The FCA is also asking firms whether further guidance would be helpful and proportionate for firms as they implement the rule change. It has taken on board feedback on its previous draft guidance, it says.

The draft guidance covers how firms should consider non-financial misconduct when assessing whether an individual is fit and proper to work in financial services. This includes how firms should consider use of social media and the relevance of behaviour in private and personal life.

The FCA says it has already decided not to proceed with guidance which is not necessary to achieve its aims. It is also not seeking to duplicate existing legal obligations on firms under the Equality Act and the recent preventative duty to protect workers from sexual harassment.

The guidance is open for consultation until 10 September. The FCA will only proceed with the guidance if there is clear support for it, it says.

The new rules will apply to FSMA firms with a Part 4A permission. It won’t apply to those without a Part 4A permission, such as payments and e-money firms, regulated investment exchanges and credit ratings agencies. The Senior Managers and Certification Regime does not apply to such firms.

• Consultation and Policy Statement. The Consultation Paper sets out the response to the feedback received and final rules on the non-financial misconduct (NFM) elements of the September 2023 Diversity and Inclusion Consultation Paper (CP23/20 PDF).