Accountability of regulators Regulator engagement with HM Treasury, external stakeholders, and Parliament Engagement with stakeholders Strengthening the role of statutory panels Requirement for regulators to publish a statement of policy on the processes they use to appoint members to their stakeholder panels
Ensuring the right membership of the panels is crucial to their success in providing challenge, a range of expertise, and differing perspectives to the regulator. Panels that have members from diverse backgrounds, with wide-ranging expertise and a variety of different perspectives will be better placed to ensure the regulators receive the most comprehensive appraisal of their policy. In order to ensure that the membership of panels represents the full diversity of stakeholders, both amongst practitioners and amongst consumers, there should be a clear and transparent process for appointing members.
	The FCA has recognised the importance of improving diversity in the membership of the panels and is already undertaking a review to identify ways to improve diversity so the composition of the panels appropriately reflects the range of practitioners and stakeholders in financial services. The government welcomes the work the regulators are doing to move recruitment of panel membership in this direction and expects the regulators will take this opportunity to commit to open and fair recruitment practices to ensure a diverse range of qualified candidates are appointed to panels.
	Building on this work, and to improve transparency, the Act introduces a requirement for the regulators to each maintain statements on their processes for appointing members to panels. The regulators will need to consult HM Treasury on the statement before it is published. This measure seeks to increase transparency of regulator operations which will improve the ability of Parliament to scrutinise them, and of stakeholders to comment on them.
	The government also recognises that consultation respondents raised concerns regarding the composition of panel membership. These included suggestions that there may be a bias towards large firms and established sectors, and suggestions that there may be a lack of representation of some groups; for example, vulnerable consumers.
	As part of their ongoing work to improve the diversity of panels, the regulators should also continue to consider the diversity of the sectoral composition of membership. In the context of emerging technologies, changing business models, and evolving consumer choices (for example, the transition towards digital payments), it is particularly important that a representative balance of stakeholder types and views are included.