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18 Gibraltar International www.gibraltarinternational.comeconomies. Governments had to act to prevent reoccurrence. Over the past 20 years director%u2019s have therefore been subject to an increasing variety and complexity of Codes of Good Governance with sanctions which are both reputational and financial should they fail.For those engaged in financial services a further challenge for a number of NEDs has recently arisen, that of being a guardian of the duties imposed by the regulators upon firms to ensure they deliver positive outcomes to their clients. This Consumer Duty requires a director (preferably a NED) to become the board Consumer Duty Champion. This has imposed a very high obligation on them to understand not only the nature of the business itself (which they should have anyway) but also the Consumer Duty impact throughout the life cycle of its products and services with not only its clients but consumers more generally. Mistakenly a number of businesses considered the new Consumer Duty requirements to be simply an extension of the treating customers fairly obligations which have existed for a number of years. They have rapidly found out that this is not the case.Board ChampionFor some directors this will inevitably prove to be an obligation too far and they will resign, but for most it will represent a duty imposed which in many circumstances good governance had already required but in a less prescriptive form. Nevertheless understanding of exactly what the requirements are and, in particular, what are the requirements concerning vulnerable clients for whom particular attention and particular duties are imposed. One of the key challenges that needs to be addressed is that of ensuring that the Board Champion does not, by virtue of his more intrusive involvement in the business, find himself effectively in an executive rather then non executive role.Another issue is one of remuneration for these additional responsibilities. The GFSC have acknowledged the additional work imposed upon the Board Consumer Duty Champion and the likelihood of the need for increased remuneration for these additional responsibilities as well as greater personal exposure to regulatory sanction in the event that the consumer outcome is not as required. This additional cost together with the cost of the increased bureaucracy in respect of management time now required to demonstrate compliance, will inevitably put up the cost of doing business in Gibraltar. It also will, at least initially, act as a distraction from senior management on their ability to focus on the prosperity of the company. Some of this distraction is necessary and can be considered symbiotic with the growth of the business. However it is difficult to see the increased reporting and recording requirements as enhancing profitability.NED ForumA further issue facing any NED operating in the crypto sphere is how Consumer Duty requirements can be met in this sector. The NEDs in these businesses face additional uncertainty and potentially additional exposure to personal sanction in the event that it is ultimately determined that consumer duty obligations were not met.As with much regulation the pendulum has swung in an anti capitalist, pro socialist direction. Regulations needed to prevent systemic risk have morphed into a control on growth and increase in cost. For NEDs it has moved from simplicity of tasks to a complexity of obligations. The swing has been a violent one. No doubt as regulation is increasingly seen as the inhibitor to business and economic growth then those complexities will be reduced as the pendulum swings back. In the meantime the Non Executive Director%u2019s have no choice but to keep swinging until the music stops.As Gibraltar NEDs become aware of what 2025 is going to present them they have begun to act collectively and a new NED Forum specifically focused on Consumer Duty has been recently created to act both as a discussion point and to facilitate learning of the new requirements. The Forum is not there to represent or to lobby as that is already amply achieved by the representative bodies on the Financial Centre Council. Rather its role will be to support, educate and encourage. The year will tell whether it is successful in those ambitions. If so NEDs may well still be swinging but at least they will be swinging in tune and in sync.Continued from p16Businesswww.gibraltarlawyers.com