The Consumer Protection Outlook Report 2023, released by the Central Bank of Ireland, highlights key drivers of consumer risk for firms, which includes poor business practices, inadequate disclosures, changing operational landscape, technology-driven risks, and shifting business models. Our Risk Consulting team explores the key themes of consumer protection in our report below.
Safeguarding consumer interests
Firms are encouraged to surpass mere compliance with legal consumer protection requirements and adopt a proactive and comprehensive approach to ensuring consumer interests are safeguarded. The following outlines the five essential themes that firms must carefully consider in safeguarding consumer interests:
- Governance and Oversight: Firms should prioritise customers throughout the product lifecycle and organisational structure. They must have robust compliance measures, risk management, and effective oversight in place;
- Transparency: Firms need to provide clear and timely product information to enable informed consumer decisions. They should also address sustainability concerns and avoid misleading practices like "greenwashing";
- Suitability: Products should meet consumer requirements and be suitable for their needs. Firms must assess consumer needs, provide accurate information and ensure compliance with legislation;
- Digitalisation: Firms should enhance the consumer experience through digitalisation while ensuring transparency, accessibility and inclusivity. They need to consider the impact on vulnerable customers and provide support and assistance as needed; and
- Macro-Economic Environment: Firms must adapt to changes in the economic landscape, assess risks to consumers and develop action plans to mitigate those risks. They should review their products, processes and services regularly to ensure they meet customer needs and provide necessary support to vulnerable customers.
Firms are encouraged to take sustained concrete action in the above areas in order to ensure consumers are supported throughout the product / service lifecycle.
