City bosses tell regulator to AXE diversity targets in Trump-style DEI pushback

Banks and investment firms have dialled up their campaign in recent months, warning the regulations would hamper growth.

The issue has also been raised during industry meetings with the regulator.

The pushback follows the watchdog's 2023 consultation which tabled that companies would be required to create and publish official diversity and inclusion plans with board-level oversight.

One City chief, who challenged Rathi over the proposals, said: "The majority of the [finance] industry has long been unconvinced by the rationale for this. We've made our concerns clear for a long time and will continue to do so."

He described tougher DEI targets as problematic, adding they just "add more bureaucracy and red tape", The Telegraph reports.

While another industry insider told the newspaper: "There is a risk the FCA is on course to introduce a cumbersome reporting regime. The only certainty of its impact will be to create jobs in HR."

MORE DEI MADNESS:

• ‘Woke’ National Trust SLAMMED for 'Head of Inclusivity' job - eye-watering salary and perks REVEALED
• London council posts DEI job ad which discriminates against white applicants
• Rupert Lowe blasts London council over woke job ad: 'Cancer of DEI runs through Britain!'

Speaking on a podcast last week, Rathi indicated the FCA would now await direction from the Labour Government before proceeding with any plans.

"Before we move forward we'll want to understand exactly what the Government wants to do more broadly for all companies, not just financial services, and make sure anything we do dovetails with that," he said.

And Tory frontbenchers have warned Chancellor Rachel Reeves that the FCA's diversity drive could cost the City up to £1billion.

Kemi Badenoch has accused the watchdog of "overreach" - and claimed its diversity plans risk hindering Labour's much-hailed growth plans.

Another industry source who met privately with the FCA said there was "an undercurrent of 'we must do something, this is something, therefore we must do this'".

A recent poll of 500 City executives by JLP found one in three bosses believe DEI has gone too far.

The Institute & Faculty of Actuaries recently abandoned plans for strict diversity rules following member opposition.

The City pushback mirrors developments stateside, where President Trump has issued an executive order ending what he termed "radical and wasteful government DEI programmes".

A FCA spokesman said: "With the Government planning work on employment rights, equality actions plans and pay gaps, we're considering next steps following our consultation with the Prudential Regulation Authority."