Dedicated to fair and effective markets

In 2015, the UK Fair and Effective Markets Review (FEMR) recommended the formation of a practitioner-led standards body dedicated to improving the fairness and effectiveness of wholesale financial markets in fixed income, currencies and commodities (FICC).

FMSB was tasked with addressing the gaps between regulation and actual market practices, to agree standards of good practice, drive adherence, and ultimately, to eliminate the bad behaviours that existing rules had occasionally failed to prevent.

With the encouragement of Members, FMSB’s remit has evolved over time beyond its original FICC front office focus to include areas of strategic importance to the wholesale financial markets, such as post-trade, with its name changing from FICC Markets Standards Board Limited to Financial Markets Standards Board Limited in April 2022.

 

 

Raising standards across our industry means addressing topical issues, at the right time, in the right way. It also requires agreed standards to be widely adopted and embedded into our industry’s ways of working. FMSB’s approach to standard setting and driving adherence to standards reflects this ambition.

FMSB’s founding principles

were set in 2015 by FEMR to:

Identify global market vulnerabilities

Develop best market practice

Drive global adherence

Develop consistent approaches to market practices

1. Identify global market vulnerabilities

In a rapidly evolving industry, a structured approach to horizon scanning ensures that emerging trends and threats are identified, ambiguities in existing trading practices are addressed, and that FMSB can respond in a timely and effective way to the risks that matter most to our Members.

2. Develop best practice

FMSB produces a range of different publications, according to the nature of the issue and the needs of our Members.
FMSB Standards: standards of market practice that Members are formally committed to adhere to.
Statements of Good Practice (SoGP): reflecting FMSB’s view of what constitutes best practice in a particular area. Members are expected to review and adapt their own market practices to align with relevant SoGPsalthough there is no formal adherence requirement.
Spotlight Reviews: focused on important emerging issues, drawing on the insight of Members and industry experts to highlight new challenges for the market and inform topics for future work.

     

    3. Drive adherence to standards

    FMSB Members complete an annual Statement of Commitment that attests to their adherence to FMSB Standards and confirms that they have the necessary internal policies, procedures and controls in place to underpin their commitment.

    In addition, our Members draw on FMSB’s SoGP’s and Spotlight Reviews to further raise standards of market practice within their firms. All FMSB publications are published on our website and non-member firms are encouraged to consider and adopt them where relevant.

    4. Promote international convergence

    Wholesale financial markets are global in nature. By bringing together major global firms, engaging with regulators in multiple jurisdictions, and participating in major international bodies and initiatives, FMSB is a powerful influence in driving international convergence of best practice and market standards.

    What people say about us

    These quotes come directly from members or are taken from FMSB annual reports or press releases. Thank you to everyone quoted for your comments.

    We value the work FMSB Members continue to do setting Standards and Good Practice for the wholesale markets in areas where it makes sense for industry to lead.

    “I am particularly pleased to see the range of FMSB Standards expanding to cover post trade efficiencies with the publication of the Transparency Draft of a Standard for Client Onboarding Documentation and Processes in early 2024. This allows the recommendations set out by the Post-Trade Task Force initiated by the Bank to establish standardised document requirements and data definitions to be operationalised across the market.

    “I look forward to seeing further output from FMSB’s Post-Trade Committee as it puts the Task Force’s recommendations into practice to deliver more effective operations in the financial markets and improve client experiences.

    Andrew Bailey

    Governor of the Bank of England

    We appreciate all those who rightly play an active role in FMSB by contributing their expertise and support to create and maintain transparent, fair and effective wholesale financial markets.

    “Last year’s output on the 3 Lines Model and Culture and Conduct MI illustrates the power of collectively sharing knowledge to improve firms’ approach on issues such as risk and behaviour.

    “I know from our engagement with FMSB that output in areas such as pre-hedging, the governance of sustainability-linked products and further work on carbon markets is due in 2024; I look forward to seeing this work contribute to higher standards in all these areas.

    Nikhil Rathi

    CEO, Financial Conduct Authority (FCA)

    When selecting banks for long-term partnerships or key transactions, we give consideration to whether they are Members of FMSB and following FMSB Standards.
    Stewart Cox

    Group Treasurer, BHP and FMSB Advisory Council and Standards Board Member