UK Regulators Abandon Mandatory DEI Rules In Financial Sector

Britain’s financial regulators, the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA), have dropped plans for mandatory diversity, equity, and inclusion (DEI) rules in the financial sector, following industry concerns over regulatory burdens.

After a 2023 consultation, both authorities decided to rely on voluntary industry initiatives and await potential legislative changes. Feedback from financial firms emphasised the need to align with existing diversity programs rather than introduce new compliance requirements. While acknowledging the importance of diversity in governance, PRA CEO Sam Woods noted that additional regulations could conflict with efforts to reduce regulatory burdens. Along with this decision, the FCA also dropped plans for a “public interest” test for disclosing investigations into financial firms.