Finance
Financial Conduct Authority boss says MPs' criticism 'not fair'
The boss of the UK’s financial watchdog has said criticism from MPs that it has failed to reform after years of scandal is “not fair”.
Nikhil Rathi, chief executive of the Financial Conduct Authority, said it is “tackling financial crime… on a scale that has never been done before in the UK”.
He was responding to a report from a cross-party group of MPs which said the FCA was “incompetent” and that its culture has “got worse rather than better”.
It also accused the FCA of failing to properly investigate the banks and other financial organisations it regulates, suggesting it may be too close to them.
The report published on Tuesday came in the wake of backlash against the FCA’s handling of the Neil Woodford investment scandal and other controversies such as its debanking report.
It referenced years of similar criticism from other reports, including a 2016 paper from the New City Agenda which said there was “a deep seated culture of box-ticking” at the FCA.
The report also hit back against the suggestion that the FCA had changed.
“It is imperative the reader doesn’t fall into the trap of thinking that the FCA… has already resolved the long list of problems the evidence that has been painstakingly gathered shows it has, because it hasn’t,” the report said.
However, in an interview with BBC Radio 4’s Money Box show, Mr Rathi defended the FCA against these claims and argued the regulator had improved.
“We will always stay focused on improving our operational performance, but I don’t think it would be fair to characterise the position as nothing has happened,” he said.
He added that the FCA is making “record numbers of financial crime prosecutions” and that it is “one of the most evolved consumer protection regimes in the world”.
The report goes on to state that the FCA may have been “captured”, meaning it is too aligned with banks and other financial organisations to act against them.
It argues there are “unmanaged conflicts of interest” within the FCA because of its role both to protect consumers and promote economic growth.
It suggested the watchdog should be stripped back to a regulator purely focused on consumer wellbeing – leaving the government to focus on economic growth.
It also suggested that the FCA’s leadership should be replaced “if necessary”, calling its current leaders “opaque and unaccountable”.
Mr Rathi said the issue of growth versus consumer protection “requires a debate”, but that Chancellor Rachel Reeves was pushing it to pursue growth.
He accepted that promoting growth can mean increasing risks for consumers, pointing to changes it made to allow more companies to list in the UK, such as on the London Stock Exchange.
“We were very transparent all the way through that discussion over the previous 18 months that this would bring more risk into the system, [but] it was judged that this was necessary,” he said.
“That does mean that over time a few more things will go wrong, but the risk appetite in the economy needed to adjust to support the growth that the economy needs.”
On the issue of accountability, Mr Rathi said the FCA appears before Parliament and select committees and publishes more data than “any other regulator in the world”.
A Treasury spokesperson told the BBC: “Many of the issues explored in the report have been extensively reviewed, and as a result the FCA has made a number of changes.”
For a company navigating one of the most consequential transformations in its history, financial clarity is not optional—it is essential. Natura &Co, the Brazilian personal care and cosmetics group behind iconic brands such as Natura and Avon, has long been committed to combining purpose-driven business with commercial performance. After a period of strategic portfolio reshaping, including the divestiture of its Aesop and The Body Shop holdings, the company is now sharpening its focus on profitability and operational excellence across Latin America and global markets.
At the center of that effort sits a deceptively complex challenge: understanding, in real time, which revenue and cost factors are driving or eroding gross margin across a highly diversified business. For years, answering that question meant manual reporting, delayed insights, and finance teams spending valuable time on data gathering rather than analysis.
That’s now changing, thanks to a co-innovation initiative developed together with SAP and Numen, a global SAP partner specializing in digital transformation and enterprise software implementation.
From manual reporting to proactive decision intelligence
The project’s goal was to replace a labor-intensive gross margin analysis process with a generative AI application embedded directly into Natura &Co’s financial workflows. Built on SAP Business AI Platform, SAP’s unified foundation integrating business technology, data, and AI capabilities, the application connects directly to data in SAP S/4HANA to provide finance teams with automated insights and narrative recommendations in real time, without the need for manual data pulls or offline reporting.
The application enables users to explore revenue, cost, and margin drivers interactively, identifying at a glance which elements are protecting or eroding margin performance across markets and product lines. Crucially, human oversight remains central to the design: the AI application generates insights, while finance professionals retain full control over interpretation and decisions.
“The implementation of gross margin analysis using AI in SAP S/4HANA marked an inflection point in the analytical capability of our finance area,” said Rogério Dias Garcia, tech manager, ERP Latam, Natura &Co. “We overcame delays and raised the standard of insights by integrating margin analysis from SAP S/4HANA with a large language model connected via the SAP AI Core layer. This architecture allowed us to provide, in an agile, secure, and completely anonymous manner, a stratified and precise view of gross margin offenders and protectors—discriminating exactly which revenue or cost elements were driving market performance.”
A collaborative architecture for scalable AI adoption
Natura &Co’s application derived from a prototype SAP partner Numen created in early 2024 at SAP’s global Hack2Build on business AI, leveraging the generative AI capabilities of SAP Business AI Platform. The solution was designed and developed through close collaboration between Natura &Co, Numen, and SAP. From the outset, the approach was to align AI adoption with concrete business priorities, ensuring the application would be scalable and production-ready rather than a standalone prototype.
Numen brought deep SAP implementation expertise to the project, combining knowledge of SAP S/4HANA architecture with hands-on experience in building solutions on SAP Business AI Platform. The technology stack—SAP S/4HANA, SAP AI Core, SAP Fiori, and SAP Business Technology Platform—provided the secure, integrated foundation needed to connect financial data with generative AI capabilities in an enterprise context.
“SAP enabled the transformation by providing the technological foundation and expert support,” said Carlos Aravechia, head of Data Design & Intelligence at Numen.
The success of the project has validated a broader conviction at Natura &Co: that generative AI, embedded directly in ERP workflows, can fundamentally reposition finance from a transactional function to a strategic business partner.
A blueprint for other businesses
The Natura &Co project demonstrates a pattern that other organizations can replicate, particularly those running SAP S/4HANA. The combination of structured ERP data with the contextual reasoning capabilities of large language models creates a foundation for decision intelligence that goes well beyond traditional business intelligence tools.
The project was built within a six-month co-innovation sprint and went live in August 2025. It is currently in use across Natura &Co’s Equador operations.
Looking ahead, Natura &Co is already planning the next phase: integrating Joule Agents to further automate the extraction of standard analytical content and deepen the AI-driven optimization of financial processes.
“The success of this initiative validates the transformative potential of embedded AI within our ERP,” Dias Garcia noted. “We are now ready to move forward—deepening these insights and integrating the capability of Joule Agents to maximize the extraction of standard content and further optimize our business decisions.”
For SAP customers evaluating how to move from AI experimentation to AI in production, the Natura &Co project offers a concrete, replicable model: start with a high-value, well-defined business process, embed AI directly into existing workflows, and build in human oversight from the start.
A girl from a disadvantaged rural family in central China topped this year’s gaokao, attracting numerous live-streamers eager to finance her education, which she declined.
The home of 18-year-old secondary school graduate Han Yaping in a Henan province village was recently bustling with live-streamers.
This attention came after Han achieved an impressive score of 699 out of 750 in the gaokao, China’s national college entrance exam.
She has received offers from China’s two leading universities, Tsinghua University and Peking University.
Han’s accomplishment is particularly remarkable given her family’s impoverished circumstances.
Her mother suffers from ankylosing spondylitis, an inflammatory arthritis affecting the spine, preventing her from working. Her father, who earns a living through farming and odd jobs, serves as the family’s sole provider. Han also has a younger sister.
The UK’s Financial Conduct Authority (FCA) published a landmark review on Monday that proposes recommendations to regulate the impact of artificial intelligence (AI) on the financial decisions made by consumers.
The review, titled the Mills Review, anticipates that both consumers and firms will start delegating “more financial decision-making to AI systems,” including for agreements, initiating transactions, and executing decisions “within agreed parameters.” One of the key findings of the review outlined that while AI can help bridge advice gaps and “support growth,” there remain risks “associated with fraud, cyber security, and consumer harm.” Conducting the review, Sheldon Mills highlighted that “AI can also amplify risks: bias, discrimination, exclusion, opaque decision-making (particularly when multiple AI models interact), misleading or hallucinatory advice and erosion of consumer trust.”
The review stated that presently, one in five adults in the UK are “already open to AI making decisions for them,” particularly when decisions feel “complex or high stakes.” It found that roughly 26 percent of the population “trust general-purpose tools such as ChatGPT, Claude or Gemini for financial advice” with little awareness that such platforms provide no “formal routes to recourse” or protections.
Overall, the Mills Review identified four areas that it anticipates will be impacted by AI in the financial sector: “the transformation of firms,” “new consumer journeys,” “a reshaped competition landscape,” and “amplified financial crime and cyber risk.” The FCA projected the shift in how consumers and firms consult AI to take place by 2030.
The Mills Review put forth seven “priority” recommendations to be considered by the FCA Board. It recommended that any transitions to autonomous AI models be monitored and that regulatory frameworks and perimeters be adapted and secured. The review called for the strengthening of “system-wide coordination and oversight,” the scaling up of the FCA’s AI Lab to enable it to support AI models and innovation for agentic finance, and an “AI-enabled agentic supervisory model” to be built and adopted. Finally, it recommended that a trusted “public-interest AI-enabled financial capability service” be developed.
The FCA announced, in the press release, that it will launch an AI “good and poor practice publication” in late 2026.
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