IFR Senior Managers: Reasonable Steps or Excuse?

Under the FCA's Senior Managers and Certification Regime, the Duty of Responsibility contains an express reasonable-steps element and the regulator carries the burden of establishing it. The Football Governance Act 2025 uses a different structure. Schedule 7 connects a club's relevant infringement to the senior management function carried out by an individual, while sections 69 and 75 require the IFR to address whether the club and the senior manager had a reasonable excuse. The answer is therefore nuanced: the Act does not reproduce the FCA's three-part reasonable-steps test, but neither does it impose unqualified or automatic liability on an IFR senior manager. This article compares the current statutory and regulatory materials as at 20 August 2026. It is regulatory commentary, not legal advice, and anyone facing an actual investigation should obtain advice on their own circumstances.

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What the FCA's regime actually gives a senior manager

The Duty of Responsibility is contained in sections 66A(5) and 66B(5) of the Financial Services and Markets Act 2000, following amendments made by the Bank of England and Financial Services Act 2016. Assuming the individual was a senior manager at the relevant time, the FCA or PRA must establish three substantive elements before treating the individual as guilty of misconduct under this route.

A contravention of a relevant requirement occurred. There must first have been, or continued to be, a regulatory contravention by the firm. The duty is not a free-standing route for sanctioning an individual where the firm has committed no relevant contravention.

The senior manager was responsible for the management of activities in relation to which the contravention occurred. A Statement of Responsibilities and, where applicable, the firm's responsibilities map are important evidence of that allocation. However, FCA guidance makes clear that responsibility is ultimately a question of fact; the Duty of Responsibility is not necessarily confined to wording in the Statement of Responsibilities alone.

The senior manager did not take such steps as a person in their position could reasonably be expected to take to avoid the contravention occurring or continuing. The assessment is individual and contextual, taking account of matters such as the person's role, the information available at the time, delegation, the nature and complexity of the firm and the action taken when problems emerged.

FCA Onus On Regulator Callout

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The FCA's published guidance is explicit that the onus is on the regulator to show that the senior manager was guilty of misconduct. That includes establishing the absence of the reasonable steps required by the statutory test.

The detail that actually matters: who has to prove what

It is common to describe reasonable steps as a 'defence', but that shorthand can mislead. Under the current Duty of Responsibility, failure to take reasonable steps is an element the regulator must establish; it is not a reverse burden requiring the senior manager to prove their innocence. In practice, however, a senior manager will still want contemporaneous evidence of decisions, challenge, delegation, escalation and follow-up. The legal burden and the practical need for evidence are different questions.

The history explains why this distinction matters. The regime was initially designed around a presumption of responsibility, under which the senior manager would have had to satisfy the regulator that reasonable steps had been taken. That reverse-burden model did not enter into force. It was replaced by the Duty of Responsibility, which came into force for banking firms on 10 May 2016, extended to dual-regulated insurers on 10 December 2018 and to FCA solo-regulated firms on 9 December 2019.

Published enforcement must also be described carefully. The PRA's 2023 action against former TSB CIO Carlos Abarca involved Senior Manager Conduct Rule 2, not a finding under the statutory Duty of Responsibility. The FCA's 2025 SM&CR review expressly noted the overlap between the duty and the Senior Manager Conduct Rules and retained the duty. Prominent public cases under the duty itself remain limited, but it would be unsafe to convert an older commentary statement into a current, absolute claim that the duty has never featured in enforcement activity.

What the Football Governance Act's own text actually says

The Football Governance Act 2025 does not copy the FCA formulation. But the relevant provisions must be read together: Schedule 7 paragraph 5 defines the infringement that a senior manager can commit, section 69 governs the outcome of an IFR investigation, section 75 sets the gateway to sanctions and the licensing framework supplies a formal personnel statement mapping senior management functions.

Under Schedule 7 paragraph 5(1), a senior manager commits a relevant infringement where the club has, without reasonable excuse, committed a relevant infringement and that infringement is connected to a senior management function carried out by the senior manager. Paragraph 5(2) separately covers a senior manager's failure to comply with a commitment accepted under section 70. Section 75(3) permits Schedule 9 action only where the IFR determines that the person has, without reasonable excuse, committed the relevant infringement. Where there is an investigation, section 69(1) requires the IFR to determine both whether the person committed the infringement and, if so, whether the person had a reasonable excuse.

That architecture creates a real safeguard, but it is not the FCA's reasonable-steps test. For derivative senior-manager liability under paragraph 5(1), the IFR must identify an underlying club infringement committed without reasonable excuse, connect it to a senior management function carried out by the individual and address the individual's own reasonable excuse before imposing a Schedule 9 sanction. The Act does not add the FCA's further element that the individual failed to take objectively reasonable preventative steps.

Three Structural Differences Box

Three structural differences that matter

Different personal-liability test.

The FCA must establish a firm contravention, responsibility for the relevant activities and a failure by the senior manager to take reasonable steps. Under the Football Governance Act, Schedule 7 paragraph 5 instead requires an underlying club infringement committed without reasonable excuse and a connection to a senior management function. Sections 69 and 75 add the individual's reasonable-excuse question before sanction.

Formal responsibility mapping exists in both regimes.

The IFR personnel statement is not identical to an FCA Statement of Responsibilities, but final licensing guidance requires it to identify each senior manager's job title, role and senior management functions. It is therefore an analogous, although differently structured, formal accountability document.

Different published position on the burden.

FCA materials expressly place the onus on the regulator to establish misconduct under the Duty of Responsibility. The Football Governance Act requires the IFR to determine infringement and reasonable excuse and gives the person notice and an opportunity to make representations, but the Act and IFR guidance reviewed do not contain an equivalent express burden statement for a senior manager's reasonable excuse.

Why this observation matters, and why we are raising it now

The comparison is useful because English football has adopted familiar concepts such as specified senior management functions, individual accountability and formal responsibility mapping without importing the FCA's Duty of Responsibility word for word. The meaningful question is therefore how the IFR's function-connection and reasonable-excuse tests will operate in practice, not whether IFR senior managers have no statutory safeguard at all.

The current regulatory materials now include the IFR's Information Gathering and Enforcement Guidance IFR/2/2025, amended ODSE rules and guidance effective from 5 May 2026, and final licensing rules and guidance published on 1 July 2026. Those materials confirm the enforcement process and the personnel-statement framework, although they do not reproduce the FCA's express statement that the regulator bears the burden of proving a failure to take reasonable steps. Future enforcement decisions, internal reviews and tribunal or court decisions may add detail to the meaning of reasonable excuse.

What this means for an SMF holder right now

Three practical points follow from the corrected comparison.

Do not assume the regimes are identical, but do not describe the IFR model as strict or automatic liability. The FCA route asks whether the manager failed to take reasonable preventative steps. The IFR route asks whether the club committed a relevant infringement without reasonable excuse, whether it was connected to the individual's senior management function and whether the individual had a reasonable excuse.

Treat the personnel statement as a substantive accountability document. The final provisional-licensing guidance requires it to identify senior managers and set out each person's job title, role and senior management functions. It is not identical to an FCA Statement of Responsibilities, but it directly informs the statutory question of which senior management function is connected to a club infringement. Clubs should make it accurate, sufficiently clear and promptly update it after material changes.

Keep contemporaneous evidence of reasonable governance and of any potential reasonable excuse. Records should show the information available, decisions made, challenge given, matters delegated, escalation routes, remedial action and obstacles outside the individual's control. That evidence may be central to representations on a warning notice even though the IFR materials do not use the FCA's precise reasonable-steps test or publish the same express burden statement.

For the detail of the personal fines, removal directions and disqualification orders an IFR senior manager can actually face, see Lagom's existing guide to personal ODSE enforcement.

A reasonable-excuse safeguard is not the FCA's reasonable-steps test. But it is also inaccurate to say that an IFR senior manager has no protection at all.

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