The Financial Conduct Authority (FCA) has decided not to proceed with its previously proposed diversity and inclusion (D&I) rules, which would have mandated data collection and target-setting for regulated firms. The regulator’s recent letter to the Treasury Select Committee (TSC) confirms that, while D&I remains a priority, the focus will shift away from prescriptive data reporting.
This decision comes after concerns were raised about the effectiveness of data collection in driving meaningful cultural change, as well as the potential compliance burden on firms—particularly smaller ones. While some in the industry may welcome the reduced regulatory pressure, others question whether a softer approach will weaken efforts to improve diversity across financial services. A strategic withdrawal? Under its initial proposals, outlined in Consultation Paper CP23/20, the FCA had aimed to introduce formal D&I strategies, diversity targets, and workforce composition reporting ...
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