Under the UK Senior Managers and Certification Regime, a role within a regulated firm that requires regulatory pre-approval because the role-holder carries individual accountability for areas of the firm's affairs that could cause significant harm to the firm or its customers.
In practiceEach Senior Management Function is assigned a statement of responsibilities, recorded in the firm's management responsibilities map, and is subject to a duty of responsibility under which the regulator can take action against the individual where reasonable steps were not taken to prevent a regulatory breach in their area. In the context of AI and model risk, firms increasingly attach explicit responsibilities for the safe development, deployment, and oversight of material AI systems to a named SMF holder.
A UK bank allocates accountability for the firm's AI and model risk framework to the SMF4 Chief Risk Officer, records this in the statement of responsibilities, and maps the supporting controls into the management responsibilities map reviewed annually by the board.
This definition is maintained by Moweb partners and used in live client engagements. For how SMF applies to your estate, or to challenge a working definition, speak to a partner.