Treasury's Bim Afolami: Cultural And Regulatory Change Needed To Make Markets 'match Fit'

Speaking at the Edelman Smithfield Investor Summit this morning (14 December), Bim Afolami said 2024 would be the year when the government made UK public markets "match fit" again.

He noted the Edinburgh, Mansion House and other reforms to drive growth and competitiveness in the financial services sector would "address some of the friction points that have developed over the last ten to 20 years".

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But he said the legal, regulatory and governance reforms the government was implementing would only success if there was a cultural change as well.

He said: "It is not just for regulators. It is for journalists, it is for investors, it is for fund managers, it is for the chief executives of public companies to say we are backing Britain, that we know this is a fantastic place to grow a business, launch a business or scale a business and we are going to take risk.

"If we can do that together, then overall we will become more prosperous, and these reforms will take effect. We have to manifest that cultural change."

Afolami also took aim at critics of the government's ambition to build a more entrepreneurial economy - citing the example of the technology sector, where the UK was only surpassed in scale by the US and China.

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But he did note there was an issue with scaling up a business past the growth phase in the UK.

"We all know the story… A company launches here with great talent, great people and great culture but it gets to a certain size and then people say they should probably go to the US to get that scale.

"We need that here. That is why we are doing the reforms; that is why we want more pension fund money; that is why we are removing the frictions; that is why we are trying to change the culture; and that is why we are working with the regulators to promote growth investments," he said.

"If you care about the British economy more broadly, you need to grow those companies from medium-sized to big companies in this country."

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