Approved persons and new senior manager functions

An “Approved Person” is an individual who is directly approved by the FCA to perform one or more activities on behalf of an authorised firm. They will continue to be approved under the new Senior Manager and Certification Regime (SM&CR).

The majority of controlled functions have automatically been converted to Senior Manager Functions (SMF) by the FCA, but it is the firm’s responsibility to ensure the individuals hold the correct SMF. See function mapping table below.

Firms with a Limited Permission – for example, motor dealers who are not directly authorised for general insurance – will normally only require one Approved Person.

When considering a candidate for approval under SM&CR, the firm must satisfy itself that a person is Fit and Proper (FIT) before applying for them to be approved as an SMF. The FCA will look at the individual’s:

  • Honesty
  • Integrity and reputation
  • Competence and capability
  • Financial soundness

Individuals can hold more than one SMF function and be an Approved Person for more than one firm so long as they are satisfied the person is FIT to undertake the role.

Function mapping for Core and Limited Scope firms (including branches)

Previous Controlled Function Corresponding Senior Management Function(s)
CF1 – Director SMF3 – Executive Director
CF2 – Non-Executive Director SMF9 – Chair
CF3 – Chief Executive
SMF1 – Chief Executive
SMF19 – Head of Third Country Branch
CF4 – Partner
SMF3 – Executive Director
SMF27 – Partner
CF5 – Unincorporated Association SMF3 – Executive Director
CF6 – Small Friendly Society Function SMF3 – Executive Director
CF8 – Apportionment & oversight SMF29 – Limited Scope
CF10 – Compliance & Oversight SMF16 – Compliance Oversight
CF11 – Money Laundering Reporting Officer (MLRO) SMF17 – Money Laundering Reporting Officer (MLRO)
CF29 – Significant Management Function SMF21 – EEA Branch Senior Management Function

Senior Managers are required to comply with the FCA’s conduct rules under SM&CR