The UK's Financial Conduct Authority has warned that many firms have significant steps left to take before the deadline for the new Consumer Duty.
The warning followed a review of a sample of implementation of plans.
The regulator said it found some disappointing results, and cited firms that had plans lacking in detail, which have been to easily approved, or the appointed consumer duty champion who was too junior to have challenge the approach.
FCA executive director of consumers and competition, Sheldon Mills, acknowledged the "scale of the reform" and said it required "significant changes".
"For firms which are further behind in making the necessary changes, there is time to put that right and for them to show they are acting in the spirit of the new duty," he said.
The regulator said it wants firms to prioritise areas that will make the biggest impact on consumer outcomes.
It also asked they share information and work with commercial partners.
However, the review also praised some progress and said some companies had "developed robust governance frameworks… with clear executive accountability for delivery and board oversight".
Consumer Duty takes effect on 31 July 2023 for new and existing products that are open to sale or renewal.
The deadline for closed products and services is 31 July 2024.
The regulation includes a new Consumer Principle that requires firms "to act to deliver good outcomes for retail customers" and rules providing greater clarity on the regulator's expectations under the new principle.
The regulator has also provided rules and guidance setting more detailed expectations for firm conduct in four areas that represent key elements of the firm-consumer relationship: the governance of products and services; price and value; consumer understanding; and consumer support.
Roddy Munro head of proposition specialists at Quilter said the review "highlights just how seriously the regulator is taking the new Consumer Duty".
"While the FCA has not been overly prescriptive in what it is expecting, this should not be confused with a lack of certainty from the regulator," Munro commented.
"Indeed, detail and accountability are key. The regulator has flagged today that you must be clear about who is leading the programme, with clear timelines and information on how the duty will be embedded within company culture."
The FCA's Mills said firms will see the benefits of the regime as it will provide "increased trust in the sector, more flexibility to innovate and in time fewer rule changes".
