Core-Asset Consulting MD Louise Powrie reflects on how Diversity, Equity and Inclusion has developed over the past year and how regulations and AI may impact its progress.

How committed to DEI are UK financial services companies in 2025?

Surveys show that DEI remains important to candidates and employees, with 68% of UK workers saying that a company’s approach to DEI is important to them when considering who to work for. Nearly 60% claimed that they would consider quitting their job if their employer backtracked on DEI commitments, and this number was even greater among young workers and those from minority backgrounds.

In a recent Reboot / Race to Equality survey, only 36% of financial services professionals believed that their companies were fully committed to enhancing diversity and inclusion. That statistic is important, given that DEI adherence matters so much to employees, but as shown below, they may be wrong about their employers not caring about DEI.

Are employers still committed to DEI?

Over and above regulatory requirements, many UK firms are expanding their internal and voluntary DEI efforts. The Institute of Directors reports that around 71% of UK business leaders say that they are maintaining or expanding their DEI efforts this year.

However, a survey in June of senior financial professionals found that 54% believed their leadership will place less focus on DEI principles in the near future, although 68% recognised that DEI practices remain increasingly important to attracting and retaining customers.

These senior professionals might be anticipating that consumers will exert enough pressure on firms to pursue diversity goals. Almost half of Europeans now say they are more likely to use a bank or insurer that promotes DEI, and this number is even greater among younger consumers.

Formal training within firms, such as unconscious bias programmes, remains common but UK Government advice recently found that evidence of its efficacy is lacking - many firms now emphasise culture change and inclusive leadership rather than standalone training sessions.

Regulatory change – Helping or hindering?

In March of 2025 the FCA changed position, dropping DEI quotas and targets after industry concerns that the requirements would become a ‘box-ticking’ exercise. Instead, they are implementing Non-Financial Misconduct (NFM) rules that will classify serious workplace behaviour issues as regulatory conduct breaches. These will come into force in September 2026, but firms are preparing now for the changes.

Although that might sound like a weakening of regulatory commitment to DEI, the strengthening of non-financial misconduct rules is significant - behaviour that would once have been an HR issue will now have regulatory implications.

Technology - a workload asset and discrimination liability?

Financial services, like all sectors, are digitising many processes, seeking to embrace the efficiency and data-driven decisions made possible by automation and the use of Large Language Models (LLMs) like CoPilot and ChatGPT. However, it has been noted that there are DEI risks associated with outsourcing work to AI algorithms. Recent legal cases with leading HR and recruitment systems are raising the question of whether their algorithms contain unknown biases. CV screening systems with no human intervention risk ruling out candidates based on attributes that would have no bearing on their capabilities in a role.

One group at risk is younger and less experienced workers. With rising employer NI costs, the traditional routes for gaining work experience through retail and hospitality are becoming increasingly rare. At the same time, automated CV screening tools often filter by years of experience, job titles or specific credentials, thereby excluding candidates with non-traditional backgrounds like volunteering, internships or side projects. Ironically, AI is being used to complete the more administrative tasks that would have been part of early career administrative roles, once providing inexperienced workers a way into the workforce.

There are also concerns that AI systems will discriminate against those who are over the age of 40 based on screening criteria. The Equal Employment Opportunity Commission (EEOC) recently settled a lawsuit with iTutorGroup for employing AI software that discriminated against older applicants. Ageism is one of many systemic biases that AI systems might perpetuate.

It is our hope that global awareness of the risks of AI bias in recruitment will continue to grow, and the value of relationships and communication in pursuing fair outcomes will remain a focus. It will also be important to have a level of human oversight in recruitment, where outcomes are reviewed by a recruiter who understands the risks of AI bias, and is able to say firstly why a role match happened and secondly what criteria the system used to reach an outcome.

At Core-Asset Consulting, we believe that people shape businesses, and businesses, in turn, impact the world we live in. By embracing diverse, equitable, and inclusive recruitment processes, businesses not only enhance their performance but also contribute to a more equal society, so we ensure that this approach is woven into every step of the candidate journey. It is our hope that consumers, candidates, business leaders and regulators will continue to value the benefits of promoting diversity in the workplace.

For UK financial services firms, DEI is no longer just about compliance or culture - it is increasingly about competitiveness. Firms that demonstrate genuine inclusion will attract talent, earn customer trust, and build resilience in a shifting global landscape.