LSB annual regulatory performance report: regulators must improve accountability
The CLSB showed significant improvement in meeting outcomes
The Legal Services Board (LSB) has published its annual regulatory performance report on the performance of the eight legal services regulatory bodies. While some regulators, including the Costs Lawyer Standards Board, showed improved outcomes, others failed to meet required standards.
The eight regulators are:
- Costs Lawyer Standards Board (CLSB)
- The Bar Standards Board (BSB)
- CILEx Regulation (CILEx Reg)
- Intellectual Property Regulation Board (IPReg)
- Council of Licensed Conveyancers (CLC)
- The Faculty Office (FO)
- Institute of Chartered Accountants in England & Wales (ICAEW)
- Solicitors Regulation Authority (SRA).
Each regulator is subject to the same Legal Services Act 2007 obligations and is expected to demonstrate how it puts the regulatory objectives at the heart of its work.
The LSB assessed bodies against 27 outcomes across five standards: Regulatory Approach, Authorisation, Supervision, Enforcement, and Well-led: governance and leadership.
The 2021 report revealed the CLSB, CILEx Reg and the SRA each met every outcome required across all standards. A significant improvement in performance from CLSB was noted, compared to 2019.
However, in respect of other regulators, more outcomes were ‘not met’ under the Regulatory Approach and Well-led standards than in 2020.
The LSB published performance reviews of the BSB and the FO against the Well-led standard in July 2021 and September 2021, respectively. The super-regulator has said it expects to see significant improvement next year, as the regulatory bodies implement action plans based on its findings.
The LSB also said it expected the other regulators to take account of the findings of both reviews, particularly with regard to points raised about transparency, which will be an “area of focus” in 2022.
The LSB is concerned about whether and how regulators gather evidence from stakeholders, use it in decision-making processes and demonstrate this clearly – either in board papers or in applications for changes to regulatory arrangements.
The super-regulator emphasised regulatory bodies must base decisions on evidence, understand the impact on their consumers, lawyers and other stakeholders, and do so in a way that takes account of the regulatory objectives and is transparent, so how they reached decisions may be clearly understood, which will in turn increase accountability.
LSB’s director of policy and regulation, Chris Nichols, said: “Through our regulatory performance framework we seek to ensure that regulatory bodies are well-led and delivering good quality regulation for the public. Our latest annual assessment shows that some regulators are doing this more effectively than others.
“The Costs Lawyer Standards Board has turned around its performance over the last two years, demonstrating that it is possible to perform well with limited resources, through innovative and collaborative approaches.
“We have also identified a number of regulators who need to demonstrate more transparently how their work is impacting on the regulatory objectives and need to improve accountability through better consultation and engagement.
“Over the coming year, we will continue to work with regulatory bodies to improve performance and create a legal services market that meets society’s needs and delivers fairer outcomes, stronger confidence, and better services.”