What DEI developments mean for UK-regulated firms

The FCA and PRA's decision not to proceed with new Diversity, Equity and Inclusion reporting requirements created a stir in the financial media last month. Viewed in light of the Government's de-regulating growth drive as well as moves in the United States to rollback DEI programmes, fears of regression were raised for inclusivity agendas. Lucy Blake provides further context.

Lucy Blake (lblake@jenner.com) is a partner at law firm Jenner & Block, where she serves as a co-chair of the firm's Human Rights and Global Strategy Practice. Her areas of focus include anti-corruption and the US Foreign Corrupt Practices Act; culture risk and sensitive investigations; Environmental, Social and Governance (ESG); and global hearing preparation.

In the autumn of 2023, the Financial Conduct Authority [1] and Prudential Regulation Authority [2] published consultation papers setting out an intent to achieve "greater levels of diversity and inclusion ... [to] improve outcomes for markets and consumers" and to "advance safety and soundness and policyholder protection by improving diversity and inclusion" respectively. The FCA in particular was expressly "clear that diversity and inclusion are regulatory concerns" and promised to put into place a regulatory framework to "establish minimum standards and give firms a better understanding of what is expected of them in this area from a regulatory standpoint" as well as "help ensure greater consistency and transparency across the sector on firms' approaches to diversity and inclusion".