SMF13 Chair of Nominations Committee

The Chair of the Nominations Committee at an FCA-regulated firm holds a designation that is structurally different from the other committee chair functions under the Senior Managers and Certification Regime (SMCR). The SMF13 holder is not primarily accountable for a functional risk or control domain — they are accountable for the quality of the process by which the firm’s board and senior leadership are selected, developed and succeeded. In a regime that places personal accountability on named individuals, the quality of that selection process is not a governance nicety. It is one of the main determinants of whether the firm will be governed well or badly over the next five to ten years.

Yet the SMF13 appointment often receives the least structured attention of any committee chair function. Nomination committees are frequently chaired by the board Chair (SMF9), who doubles as SMF13; the designation is sometimes handed to whichever non-executive director has been on the board longest; and the committee’s work can shrink to an annual look at a board skills matrix. This article looks at the role from the board’s side of the table: what succession governance actually demands, what the nomination committee is answerable for to the regulator, what a strong candidate looks like, and how the SMF13 holder should work alongside the Chair and the Senior Independent Director.

If you are running the appointment itself — drafting the brief, building the longlist, interviewing and preparing the regulatory submission — our separate SMF13 Chair of Nominations Committee hiring guide walks through the search process step by step. This page deals with the governance questions a board should settle before and around that search.

The SMF13 Designation: What Personal Accountability Covers

SMF13 is an FCA-designated senior management function. It applies to the chair of the nomination committee at dual-regulated firms (banks, building societies, insurers and PRA-designated investment firms) and at FCA solo-regulated firms that fall into the enhanced tier of the SMCR. Core and limited scope solo-regulated firms do not have an SMF13 function: if a smaller firm chooses to run a nomination committee, its chair is not a senior manager by virtue of that role, although they may hold another SMF such as SMF9 or SMF3. Because SMF13 is an FCA function, the FCA is the approving regulator even at a dual-regulated firm.

The SMF13 holder is accountable for chairing and overseeing the committee’s work. In practice that work covers board and senior management succession planning, the identification and assessment of candidates for board and senior manager roles, the evaluation of the board’s collective knowledge, skills and experience against what the firm’s business model and permissions require, and the management of the appointment process when a vacancy arises. The Duty of Responsibility means that if something goes wrong in an area the SMF13 holder oversees, the regulator can ask whether they took reasonable steps to prevent it. For a nomination committee chair, “reasonable steps” is largely about process: a documented succession plan, a properly run search, a credible fitness and propriety assessment, and minutes that show the committee challenged rather than rubber-stamped.

The FCA’s expectation is that succession planning is genuine — naming potential successors, assessing readiness, and considering the interim cover that would apply if a senior manager left without notice. The SMF13 holder is the individual most directly accountable for whether that standard is met, and for being able to show a supervisor how the committee reached its conclusions.

What the designation does not cover

SMF13 is not an executive role and does not make the holder responsible for running HR, talent management or the firm’s recruitment function. Management builds the pipeline; the committee oversees it, tests it and makes recommendations to the board. Nor does SMF13 replace the board’s collective responsibility for appointments: the committee recommends and the board decides. Keeping this line clear matters, because a nomination committee chair who drifts into running the search themselves loses the independence that makes their oversight valuable.

The NomCo’s Regulatory Role Beyond Succession

The nomination committee’s responsibilities at a regulated firm go further than the appointments and succession work the title implies. The committee typically has a role in the ongoing fitness and propriety assessment of the board and senior managers, in commissioning and acting on the board effectiveness review, in setting and monitoring the board’s approach to diversity of skills, background and perspective, and in judging whether the board’s collective competence matches the firm’s current and planned regulatory permissions.

The fitness and propriety dimension is particularly significant. Firms must assess senior managers as fit and proper before applying for approval and keep that assessment under review afterwards. The nomination committee is the natural home for the board-level part of that oversight: checking that each director and SMF holder continues to meet the standard on an ongoing basis, not only at the point of appointment. That includes considering changes in a director’s circumstances, new information about previous conduct, regulatory references received for incoming appointees, and how the firm handles a concern about an existing board member. Our explainer on what fitness and propriety means at the FCA covers the test itself.

Ongoing fitness monitoring is one of the most underperformed parts of nomination committee governance. Many firms carry out a thorough assessment at appointment and then confirm it annually with a short declaration, without any active process that would surface a concern between cycles. The SMF13 holder is the person who should be asking whether that process exists, who runs it, and when the committee last saw evidence that it works.

The committee’s regulatory touchpoints

• Approval applications. The committee should be satisfied with the fitness and propriety assessment before the firm submits Form A for any senior manager it has recommended.
• Statements of Responsibilities. When responsibilities move between senior managers, the committee should understand the effect on individual accountability and on succession cover.
• Temporary cover. Where a senior manager leaves unexpectedly, the committee should know who can step in under the 12-week rule and what happens if a permanent appointment takes longer.
• Supervisory dialogue. Supervisors may ask to meet the SMF13 holder, particularly around a significant appointment or a change of Chair or CEO. The chair should be able to explain the committee’s reasoning without reading from a script.

Succession Planning: What the FCA Expects the NomCo to Deliver

The FCA’s expectation of succession planning at regulated firms is higher than what many nomination committees deliver. A supervisor reviewing board and committee papers wants to see evidence of genuine planning — not a policy statement, but actual assessments of who could succeed each senior manager, what development they need, and what the firm would do if a vacancy arose in the next six months.

The SMF13 Chair is responsible for making sure this work happens and is recorded. That means leading a structured annual succession review that looks at each senior management function in turn, identifies whether internal candidates are ready now, ready in one to two years or not ready, and makes sure the board understands the succession risks in the firm’s current leadership — including concentration risk where several SMFs or prescribed responsibilities sit with a small number of people. Our guide to SMCR board succession planning sets out a working framework for that review.

At smaller regulated firms where the nomination committee chair is also the board Chair, succession planning includes the Chair’s own succession. That requires care so that the incumbent does not have undue influence over who replaces them. Good practice, reflected in the UK Corporate Governance Code, is that the Chair does not chair the committee when it is dealing with the appointment of their successor; at many firms the Senior Independent Director (SMF14 at a dual-regulated firm) leads that process instead.

Three horizons the committee should plan for

• Emergency cover. Who steps in tomorrow if the CEO, CFO or a control function head leaves, and are they capable of meeting the regulator’s expectations during a temporary period?
• Planned succession. Which roles are likely to turn over in the next two to three years because of tenure, retirement or the firm’s strategy, and is there a credible internal or external route for each?
• Strategic change. If the firm plans a new permission, a significant acquisition or a change in business model, does the board’s composition and the senior management bench match where the firm is going rather than where it has been?

A succession plan that only covers the first of these horizons is a contingency list. One that covers all three gives the board a basis for decisions on development, external hiring and board refreshment. Where the plan points to an external search, our nomination committee chair recruitment team can support the committee on its own chair appointment as well as the roles it oversees.

Working with the Chair and the Senior Independent Director

The nomination committee chair sits in a triangle with the board Chair and the Senior Independent Director. How those three relationships work has more effect on the quality of succession governance than any terms of reference.

The board Chair

Where the Chair also chairs the nomination committee — a common arrangement and one the UK Corporate Governance Code allows — the SMF13 and SMF9 accountabilities sit with one person. That is efficient, because the Chair already owns board composition and leads the relationship with major shareholders. The risk is that the Chair’s view of who should join the board becomes the committee’s view by default. Boards in this position should make sure the other committee members are genuinely independent, that the committee takes external input on candidates, and that the Chair steps aside for anything touching their own role. Our guide on how to hire a chairman covers the Chair search itself.

Where the roles are split, the SMF13 holder needs a working relationship with the Chair that allows candid disagreement. The Chair is likely to have strong views on the board they want to lead; the nomination committee chair’s job is to make sure those views are tested against the skills matrix, the effectiveness review and the regulator’s expectations before they become recommendations.

The Senior Independent Director

The SID is the board’s safety valve: a sounding board for the Chair, an intermediary for other directors and the person who leads the Chair’s appraisal. In succession terms, the SID usually leads the search for a new Chair and the annual evaluation of the Chair’s performance. The SMF13 holder and the SID therefore need to agree, in advance, how the Chair’s succession will be handled: who leads, which committee members take part, how major shareholders are consulted and what information the incumbent Chair receives. Leaving that to the moment a Chair announces their departure is how boards end up with a rushed, Chair-influenced process. Where the board needs to strengthen this role, our senior independent director recruitment service handles SID appointments at regulated firms.

The other committee chairs

The nomination committee also depends on the audit, risk and remuneration committee chairs. They see the strengths and gaps of the executives who report to their committees, and they are often the best judges of whether an internal successor for a control function is ready. The remuneration committee, in particular, shapes the packages that make external appointments possible and sets the deferral and malus terms that follow senior managers across a move — we cover that relationship in our article on the Chair of the Remuneration Committee at FCA firms. A nomination committee chair who meets the other committee chairs regularly, outside the formal cycle, will have a far better view of the bench than one who relies on management papers.

Diversity and Inclusion: The NomCo’s Governance Responsibility

The regulatory picture on diversity has changed and boards should be clear about where it now stands. In 2023 the FCA and PRA consulted on rules that would have required in-scope firms to set diversity and inclusion targets, collect data and report on it. In March 2025 both regulators announced that they would not proceed with those rules; the PRA’s statement on CP18/23 sets out its position. There is therefore no FCA or PRA rulebook requirement for regulated firms to set board diversity targets.

That does not take diversity off the nomination committee’s agenda. Listed companies remain subject to the Listing Rules disclosure on board diversity targets on a comply-or-explain basis. Companies applying the UK Corporate Governance Code must describe their diversity and inclusion policy and its effectiveness in the nomination committee report. And the regulators continue to treat culture, challenge and the avoidance of groupthink as supervisory concerns, with non-financial misconduct now addressed through the Conduct Rules. A board drawn from one narrow background is less likely to challenge management effectively, and supervisors are interested in whether the board challenges.

The capability point for an SMF13 appointment is practical rather than regulatory. A nomination committee chair needs experience of structuring appointment processes that reach beyond the usual networks, of assessing candidates on what the role requires rather than on a traditional board CV, and of reporting honestly on board composition where the firm is listed or applies the Code. Those skills are what produce better boards, whether or not a rule requires a target.

What Makes a Strong SMF13 Candidate

The SMF13 candidate brief should assess capability across four dimensions.

Succession governance experience. Direct experience of leading a board-level succession process, at a regulated firm or a business of comparable governance complexity, that engaged with real succession risk rather than procedural compliance. Ideally the candidate will have chaired, or sat on, a committee running at least one significant executive appointment — a CEO, CFO or Chair — so they know what a well-run search requires and where they go wrong.

Regulatory fitness and propriety expertise. A working understanding of the FCA’s fitness and propriety standards, regulatory references and the ongoing monitoring obligations on firms, sufficient to lead the committee’s oversight with real rather than nominal rigour. At dual-regulated firms, familiarity with the PRA’s expectations is also important, because the committee will be recommending candidates for PRA-designated functions as well as FCA ones.

Independence. The SMF13 Chair must be independent in their oversight of appointments. On boards where the CEO has significant influence over non-executive appointments, the nomination committee chair’s independence is the main safeguard against a management-dominated board developing over time. A chair who defers to the CEO on who joins the board is not providing the governance the designation requires.

Judgement about people. This is the hardest quality to evidence and the most important. The best nomination committee chairs can read a room, spot when an internal candidate is being promoted beyond their readiness, and have the difficult conversation with a long-serving director whose skills no longer fit. Referees who have sat on committees with the candidate are the best source of evidence here.

Red flags in a candidate

• A track record of chairing nomination committees that only ever recruited from the Chair’s or CEO’s own network.
• Difficulty describing a succession decision they disagreed with and how they handled it.
• Limited time: a nomination committee chair with several other board roles may not have capacity when a sudden vacancy needs weeks of intensive work.
• Close prior relationships with the executives whose succession they will oversee.

Most firms fill this seat from their existing non-executives, but where the board lacks the right profile an external appointment is often the better answer. Our financial services non-executive recruitment practice covers that search, and our wider board of directors recruitment work helps boards rebalance composition around a new committee structure.

The Form A Process for SMF13

Under the current rules, an SMF13 appointment requires FCA approval before the individual can perform the function. The firm submits Form A with the candidate’s regulatory history, fitness and propriety assessment and criminal records check, together with the Statement of Responsibilities and an updated management responsibilities map where the firm is required to keep one. The statutory period for the FCA to determine a complete application is three months, and it can run longer where an application is incomplete or the FCA asks for more information. Our guide to how long FCA SMF approval takes explains what affects timing in practice.

The FCA’s first phase of SMCR reforms, set out in PS26/6, took effect for most changes from 24 April 2026. It revised the 12-week rule on temporary cover, criminal record checks, Statements of Responsibilities and regulatory references, among other areas. For a nomination committee, the practical effect is to make the administrative side of appointments lighter, but not to change the fitness and propriety standard or the board’s responsibility for getting the choice right.

For a candidate who already holds an SMF at the same firm — for example, a non-executive adding the nomination committee chair to an existing committee chair role — the firm still needs approval for the additional function, but the assessment is usually more straightforward because the FCA already knows the individual. For an external candidate new to the firm, the board should build the full approval period into its timetable and decide in advance how the committee will be chaired in the meantime.

The Proposed Move to Notification for SMF13

In October 2026 the FCA published CP26/37, the second phase of its SMCR review. Among other changes, it proposes moving the non-executive committee chair functions, including SMF13 and the risk, audit and remuneration committee chairs, from pre-approval to a notification regime. Under the proposal, a firm would complete its own fitness and propriety assessment and notify the FCA, rather than waiting for approval before the individual could take up the role. The PRA’s parallel consultation covers the PRA-designated functions separately.

This is a proposal, not a rule. The consultation closes in January 2027 and the final shape may differ. Boards appointing an SMF13 now should plan on the basis of the current approval process.

If notification does replace approval, it raises rather than lowers the stakes for the board. The regulator’s gatekeeping check would move to after the event, and the firm’s own assessment would carry the weight. A nomination committee that appoints its own chair on a thin assessment would have less protection than it does today, and the quality of the committee’s process — references, due diligence, documented reasoning — would be the evidence a supervisor looks at first.

Working with Exec Capital

Exec Capital places nomination committee chairs and board-level non-executives at FCA-regulated firms. We assess SMF13 candidates on their succession governance record, their understanding of fitness and propriety, their independence and their capacity, and we support the firm through the Form A submission as part of the assignment. Every search is run by our specialist team, with Adrian Lawrence FCA overseeing each mandate.

We can also help a nomination committee with the appointments it oversees: Chair, CEO and senior manager searches, interim cover while a permanent appointment is approved, and independent benchmarking of internal candidates. To discuss an SMF13 appointment or a wider board review, see our nomination committee chair search service or call 0203 834 9616.

The NomCo’s Role in Board Effectiveness Reviews

The annual board effectiveness review is one of the nomination committee’s core responsibilities. Under Provision 21 of the UK Corporate Governance Code 2024, boards should carry out a formal and rigorous annual review of the board, its committees, the Chair and individual directors, with FTSE 350 companies having an externally facilitated review at least every three years. Provision 23 asks the nomination committee report to explain how the review was conducted and what the board has done in response. Unlisted regulated firms are not bound by the Code, but many follow it voluntarily and supervisors use it as a benchmark.

For the SMF13 Chair, the review is both a governance deliverable and a succession tool. Its findings on the board’s collective capability gaps should feed directly into what the next non-executive or committee chair appointment needs to address. Our board effectiveness review guide covers how to run the process.

Supervisors are interested in the quality of board self-assessment, particularly in the context of Consumer Duty and operational resilience oversight. A review that identifies no improvements, that leads to no change in composition or working practices, or that produces a report that is filed rather than acted on, does not show the board self-assessment quality the regulator expects. The SMF13 Chair should make sure the review produces honest findings, that those findings are discussed and acted on, and that the committee’s succession planning responds to the gaps the review identifies.

Turning review findings into appointments

• Translate each capability gap into a specific requirement on the skills matrix, with a date by which it should be filled.
• Decide whether the gap is best filled by development, a new appointment, an adviser to the board or a change in committee membership.
• Report back to the board on progress at the next review, so the cycle closes rather than restarting from scratch.

Regulatory Expectations on Board Composition and Diversity

Regulated firms are expected to have a board whose collective knowledge, skills and experience match the firm’s business, risks and permissions. For dual-regulated firms, the PRA also expects boards to have enough independent challenge and enough time from their non-executives to do the job. The nomination committee is the body that makes and evidences that judgement, and the SMF13 holder is the person who must explain it if a supervisor asks why the board looks the way it does and what the firm is doing to develop it.

Provision 17 of the UK Corporate Governance Code sets out the nomination committee’s role for companies that apply it: leading the process for appointments, making sure there is a plan for orderly succession to both the board and senior management, and overseeing the development of a diverse pipeline for succession, with a majority of the committee made up of independent non-executives. Provision 23 then requires the annual report to describe the committee’s work, including its approach to succession planning, its appointment process and its diversity and inclusion policy. Even where a firm is not required to apply the Code, these provisions are a useful benchmark for what good looks like.

The practical challenge is that a genuinely broad candidate pool at regulated board level requires a search that goes beyond the networks most board searches draw on. Candidates with the regulatory record, governance experience and technical knowledge that regulated non-executive roles need are out there, but finding them takes active effort. The nomination committee chair’s job is to make sure the brief, the search firm briefing and the longlist criteria are built to widen the pool rather than to screen a traditional one. An effective SMF13 Chair will agree, for each appointment, which sourcing channels will be used and how the committee will assess candidates against the full range of the role’s requirements rather than against a standard board CV.

Frequently asked questions

Which firms need an SMF13?

SMF13 applies to the chair of the nomination committee at dual-regulated firms and at enhanced-tier solo-regulated firms. Core and limited scope firms do not have an SMF13 function.

Can the board Chair also be the SMF13?

Yes. It is a common arrangement. The Chair should not chair the committee when it is dealing with their own successor, and the committee should be majority independent.

Is SMF13 still subject to FCA approval?

Yes, under current rules. CP26/37 proposes moving SMF13 to notification, but that is a consultation proposal and has not been finalised.

Do regulated firms still need board diversity targets?

Not under FCA or PRA rules, which were dropped in March 2025. Listed companies still have Listing Rules disclosure obligations, and Code companies report on their diversity policy.

Who leads the search for a new Chair?

Usually the Senior Independent Director, working with the nomination committee, so the incumbent Chair does not steer the choice of their successor.