As the UK prepares to host the G20 presidency in 2027, it has an opportunity to bring international partners together and help shape the global conversation on trusted AI, writes Susan Langley
The UK’s reputation as a global financial centre rests on more than the strength of its markets, the depth of its talent or the reach of its international networks. It also rests on trust.
I’ve often said this year that capital goes where it feels welcome and stays where it’s secure. Investors need confidence that the rules are clear, that risks are managed and that the institutions underpinning our financial system uphold the highest standards. Our regulators, respected around the world, are central to providing that confidence, helping make the UK a place where businesses want to invest and grow.
This week, I will host the Financial Conduct Authority and the Prudential Regulation Authority at the City Regulators’ Dinner. I will make clear that maintaining high standards must go hand in hand with a regulatory framework that keeps pace with advances in artificial intelligence (AI), digital assets and tokenisation.
The financial centres that thrive are those that combine robust regulation with an environment that enables innovation. Striking that balance will be essential to ensuring the UK remains competitive as the global financial landscape evolves.
The City of London Corporation’s Regulating for Growth report, published last year, set out practical recommendations for more predictable and proportionate regulation, reducing unnecessary burdens and strengthening engagement between regulators and industry. It’s not a call for wall-to-wall deregulation or the City becoming the wild west of financial hubs, it’s about greater flexibility and simplification in our financial hub.
We welcome the progress made since its publication, and the commitment from regulators to deliver a framework that supports growth while maintaining the standards on which the UK’s reputation depends.
London can lead the AI conversation
Working across industry, government and regulators is exactly what the UK needs to do to enhance its regulatory framework. Initiatives such as OFI Financial Services, a single front door and concierge service for international firms looking to expand in the UK, is a prime example. By helping businesses navigate the regulatory landscape and understand requirements earlier, we can make it easier to invest here.
International investors consistently tell us that clarity and predictability of the long-term direction of regulation are important when deciding where to invest. The next challenge is to ensure that the progress we have made translates into a consistently positive experience for firms of all sizes. That becomes even more important as technology reshapes financial services.
AI has enormous potential to improve productivity and unlock new products and services. Digital assets and tokenisation could transform how financial instruments are traded creating opportunities to make markets more efficient and accessible. It really feels like with AI and emerging digital tech, we’re at the start of another Industrial Revolution and the financial services sector can be at the forefront of that in the UK.
The UK has made a promising start. Regulatory sandboxes, of which the UK was the first to introduce, and have since been replicated in 50 other jurisdictions, offer businesses opportunities to test new technologies in controlled environments, supporting experimentation while protecting consumers and financial stability.
Financial markets increasingly operate across borders, while emerging technologies can be deployed internationally at speed. Divergent regulatory approaches risk creating fragmentation, increasing costs for businesses and making it harder to manage risks consistently.
We therefore need greater international cooperation on the use of AI in financial services. Common principles, stronger regulatory interoperability and closer collaboration between standard-setting bodies can help firms innovate across markets while maintaining robust safeguards.
As the UK prepares to host the G20 presidency in 2027, it has an opportunity to bring international partners together and help shape the global conversation on trusted AI.
The Prime Minister has set out an ambition for the UK to help shape the international agenda on AI. Financial services should be an important part of that effort. By drawing on our expertise in financial regulation, we can help build approaches that encourage innovation while maintaining public confidence.
Now we must build on the UK’s record of world-leading regulation, working together at home and internationally to ensure that our regulatory strengths remain a source of competitive advantage.
Susan Langley is the Lady Mayor of the City of London