SMF13 Chair of the Nomination Committee: Responsibilities, Approval and CP26/37

SMF13, the Chair of the Nomination Committee function, is the senior management function held by the person who chairs a firm's nomination committee, the board committee that finds, assesses and recommends people for the board. It applies at Enhanced firms and at UK banks and insurers that have a nomination committee, and only where the firm has one. It is an approved role today; the FCA's CP26/37 proposes to make it notified at dual-regulated and Enhanced firms.

What SMF13 covers

SUP 10C.5A.3R defines the function in one sentence: if the firm has a nomination committee, SMF13 is acting as the chair of that committee. Nothing more is needed to fall within it. If a firm sets up a nomination committee voluntarily, chairing it is still SMF13, and the firm can later wind the committee up, at which point the chair stops performing the function (SUP 10C.5A.2G). The rules never require a firm to create a committee just to fill this role.

The holder is a non-executive director. Common job titles are Chair of the Nominations Committee, Chair of the Nomination and Governance Committee and, at many firms, simply the board Chair, who often chairs nominations as well.

What the committee does depends on the firm. For a bank or investment firm classed as a significant SYSC firm (a larger firm on the FCA's size tests), SYSC 4.3A.8R requires a nomination committee made up of board members who have no executive role. Non-SNI investment firms above the size thresholds in MIFIDPRU 7.1.4R must set one up under MIFIDPRU 7.3.5R, with at least half its members and its chair drawn from the non-executive members of the board.

Example: an Enhanced asset manager has a board of eight with a nomination committee of three non-executives. The senior independent director chairs it. She needs approval as SMF13 as well as SMF14, and one Statement of Responsibilities covers both roles.

For the full set of roles see our Senior Management Functions guide.

Which firms need an SMF13

The FCA lists where each function applies in SUP 10C Annex 1.

SMF13 is unusual among the board committee chairs. At dual-regulated firms (those supervised by both the PRA and the FCA), the chairs of the risk, audit and remuneration committees and the senior independent director are PRA functions. SMF13 is not: the PRA has no nomination committee function, so SMF13 stays an FCA function, as CP26/37 confirms.

There is a shortcut. Under SUP 10C.9.8R, a person approved by the PRA for any PRA function, whose PRA application said they would also chair the nomination committee from the same time, does not need separate FCA approval as SMF13. The FCA's own example in SUP 10C.9.9G is a board Chair, approved by the PRA as SMF9, who chairs nominations from the outset. If the nomination role is added later, FCA approval is needed.

What the SMF13 holder is personally accountable for

Statement of Responsibilities. This is the document the regulator holds that lists what this person answers for. For SMF13 it records chairing the nomination committee and overseeing its work, plus any prescribed responsibilities. Our article on statements of responsibilities and management responsibilities maps covers drafting.

Prescribed responsibilities. These are specific duties the rules require a firm to give to a named senior manager. SYSC 24.3.2G says the FCA normally expects responsibilities such as training and development of the board (PR F) and the oversight responsibilities to sit with a non-executive senior manager. PR F applies at UK banks and Solvency II insurers; SYSC 24 Annex 2 names SMF9 as its most likely holder but does not list SMF13 as hard to justify, so a nomination chair can hold it. At dual-regulated banks, the PRA allows its oversight responsibilities, such as board induction and training, culture, and the independence of internal audit, compliance and risk, to be given to the FCA's nomination committee chair as well as to PRA oversight functions (PRA Allocation of Responsibilities rule 3.2).

Conduct Rules. As a senior manager the holder must follow the Individual Conduct Rules in COCON 2 and the Senior Manager Conduct Rules SC1 to SC4. In plain words: keep the area you answer for under control (SC1), take reasonable steps to make it comply (SC2), delegate only to suitable people and supervise them (SC3), and tell the regulator what it would reasonably expect to know (SC4). Current FCA guidance on SC4 makes clear it covers matters about the senior manager personally, not only the firm.

Duty of Responsibility. Under section 66A(5) of FSMA the regulator can act against a senior manager if the firm breaches a requirement in an area they are responsible for and they did not take the steps a person in their position could reasonably be expected to take. DEPP 6.2.9-EG accepts that a non-executive's reasonable steps may differ from an executive's. The FCA's expectations of a nomination committee chair are in COCON 1 Annex 1: safeguard the committee's independence, oversee its performance and take reasonable steps to ensure the firm complies with SYSC 4.3A.

Reasonable steps in practice

The general standard is in our article on senior manager reasonable steps. For a nomination chair, evidence comes from the duties in SYSC 4.3A.9R.

Under notification the committee's appointment record becomes the main evidence that a non-executive chair was properly vetted. A file showing references, criminal records check, skills review and the committee's reasons is what a supervisor will ask for.

The first 90 days in the role

• Read the committee's terms of reference, the last year of papers and the most recent board effectiveness review.
• Agree your Statement of Responsibilities and confirm which prescribed responsibilities, if any, you hold.
• Check the board skills matrix against the firm's strategy and the risks in its business plan.
• Review the succession plan for the chair and chief executive. Ask what happens if either leaves tomorrow.
• Meet the holder of PR A, the executive answerable for vetting senior managers, and walk through how board candidates are checked.
• Confirm the diversity policy and any gender target are current and reported.
• List directors approaching tenure or time-commitment limits and plan for them.
• Set the committee calendar for the year, including the annual board and skills reviews.

Applying for approval

Today the firm applies on Form A, and at Enhanced and dual-regulated firms alike the FCA approves SMF13. The firm must first satisfy itself that the candidate is fit and proper under FIT: honest and of good reputation, competent and capable, and financially sound. Our guide to fitness and propriety explains the test.

• Regulatory references: under SYSC 22.2.1R from the current employer and every employer in the past six years. Since 24 April 2026 the firm asked should respond within four weeks.
• Criminal records check: valid for six months, and not needed for a move within the firm or group (PS26/6).
• Competence: board and appointments experience, plus an induction plan for any gaps.
• Interview: the FCA may interview candidates where it has questions about fitness or the firm's risk profile (How we assess).
• Timing: the regulator must decide within three months of a complete application (FSMA section 61), with the clock paused while it waits for information. The FCA has committed to work to two months.

A planned appointment cannot start before approval. Under the temporary cover rule, someone may cover an absent SMF13 where the absence is temporary or reasonably unforeseen; since PS26/6 the firm has 12 weeks to submit an application and the person can act until the FCA decides. Acting without approval outside that rule exposes the person to action under section 63A of FSMA.

What CP26/37 would change for SMF13

CP26/37 proposes that SMF5, SMF10, SMF11, SMF12, SMF13, SMF14 and SMF15 become notified, not approved, at dual-regulated and Enhanced firms. SMF13 is on the list, and because it is an FCA function everywhere, the firm would always notify the FCA.

In practice:

• The firm, not the FCA, makes the fitness and propriety decision. It completes the same checks first: regulatory references, criminal records check, right to work and a Statement of Responsibilities. The holder of PR A answers for that vetting.
• The firm submits the notification through My FCA up to three months before the start date. The FCA runs only automated checks, for example that the form is complete and the person is not prohibited.
• The appointment takes effect on the stated start date, or on acknowledgement for an immediate appointment, and the person appears on the Financial Services Register.
• The standards do not change. The Senior Manager Conduct Rules and the Duty of Responsibility apply in full.
• The FCA could still require approval in exceptional cases, such as serious concerns about a firm's governance, using its section 55L powers.

The board Chair shortcut survives: CP26/37's version of SUP 10C.9.9G says a PRA-approved Chair who also chairs the nomination committee need not notify the FCA of SMF13.

On prescribed responsibilities, the FCA would keep only PR A, PR D and PR Z, plus PR J-3 at Enhanced firms. SYSC 24 Annex 2 treats PR A, PR D and PR J-3 as hard to justify for SMF13, so at an Enhanced firm SMF13 would usually hold no FCA prescribed responsibility. The PRA keeps a longer list of its own, so check CP14/26 for bank oversight responsibilities.

Firms can keep applying for approval until commencement and notify future appointments from one month before. Consultation closes on 22 January 2027; final rules are expected in the first half of 2027 and would take effect around six months later, subject to the Financial Services and Markets Bill. Core and Limited Scope firms are not affected because SMF13 does not apply to them. See our CP26/37 article.

Holding SMF13 with other functions

• SMF9, Chair of the Governing Body: the most common pairing. At a dual-regulated firm the PRA's SMF9 approval can absorb SMF13. Watch the conflict when the committee plans the Chair's own succession: the senior independent director should lead that item. See our SMF9 guide.
• SMF14, Senior Independent Director: a natural fit, since the SID leads the Chair's appraisal. See our SMF14 guide.
• SMF12, Chair of the Remuneration Committee: workable, but one person then decides who joins and what they are paid. See our SMF12 guide.
• Executive roles: SYSC 4.3A.8R requires nomination committee members at significant firms to have no executive role, so an executive cannot chair it there.

How we support SMF13 holders

We prepare nomination committee chairs for approval today and for notification under the proposed rules, working from the committee's own papers and the firm's appointment records. See our Senior Manager training and SM&CR support.

• one-to-one Senior Manager training built on the person's own Statement of Responsibilities
• drafting and review of the Statement of Responsibilities
• the Form A application and fitness and propriety file
• FCA interview preparation
• handover arrangements