Business

PwC’s US chief executive has delivered a stark warning to senior staff, declaring that partners who resist artificial intelligence “have no place” at the firm as it rapidly reshapes its business model to adapt to technological disruption.

Paul Griggs, who took over as US CEO in May 2024, said the professional services giant is moving decisively towards an AI-first operating model, with automation set to fundamentally alter how tax, audit and consulting services are delivered, and priced.

In comments reported by the Financial Times, Griggs made clear that no one within the organisation would be exempt from the transformation, warning that those unwilling to embrace AI would ultimately be left behind. He said any partner who believed they could opt out of the shift “is not going to be here that long”, underlining the urgency with which the firm is pursuing change.

At the heart of PwC’s strategy is a move away from the traditional billable-hours model that has long underpinned the economics of the Big Four. Instead, the firm is developing AI-powered tools capable of delivering services directly to clients without the need for constant human involvement.

Some tax and consulting services are being converted into automated platforms that clients can access independently, with pricing expected to shift towards subscription-based models rather than time-based billing. This marks a significant departure from the labour-intensive structure that has historically relied on large teams of junior staff carrying out routine analytical and administrative tasks.

The firm is set to formalise this direction with the launch of “PwC One”, a new AI platform offering clients access to a suite of automated services. Initially covering areas such as mergers and acquisitions due diligence and complex tax advisory, the platform is expected to expand rapidly as PwC builds out its AI capabilities.

The move reflects a broader existential challenge facing the professional services sector. Advances in generative AI and automation are increasingly capable of handling tasks that were once the preserve of consultants and analysts, raising questions about the long-term viability of traditional advisory models.

For firms like PwC, Deloitte, EY and KPMG, the risk is twofold. Not only could AI reduce the need for large workforces, but it could also enable clients to bring more capabilities in-house, bypassing external advisers altogether. In response, PwC is attempting to reposition itself as both a provider of expertise and a developer of scalable technology solutions.

Griggs’ comments also point to a cultural shift within the firm, where adaptability to AI is becoming a core expectation rather than a specialist skill. Senior staff are being told that embracing automation is no longer optional, but essential to maintaining relevance in a rapidly evolving market.

Industry experts say the shift is inevitable. Raj Abrol, chief executive of Galytix, described AI as a transformative force in risk management and decision-making, particularly in an era defined by economic and geopolitical uncertainty. He noted that the ability to process and interpret vast datasets in real time is becoming a critical competitive advantage for organisations navigating increasingly complex environments.

Kenny MacAulay, chief executive of accounting platform Acting Office, was more blunt, arguing that AI scepticism is incompatible with modern business leadership. He said firms that fail to integrate AI quickly risk falling behind competitors who are already leveraging automation to improve efficiency and client outcomes.

PwC’s aggressive stance highlights how quickly AI is moving from experimental technology to operational necessity. As the firm accelerates its transition, the message to its workforce is unambiguous: adapt to the AI-driven future, or risk being replaced by those who will.

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PwC warns AI sceptics ‘have no place’ as firm accelerates shift to automated services

The UK government has stepped back from one of its most controversial proposals on artificial intelligence and copyright, signalling a decisive shift towards market-led licensing and greater transparency rather than sweeping legal reform.

In its long-awaited Report on Copyright and Artificial Intelligence, published in March 2026, ministers confirm they will no longer pursue a broad copyright exception for AI training with an opt-out mechanism — a policy that had triggered fierce opposition from across the UK’s creative industries.

Instead, the government is opting for a more cautious, evidence-led approach, prioritising transparency obligations and allowing a nascent but rapidly expanding licensing market to develop. The move marks a significant recalibration of policy at a time when the UK is seeking to position itself as both an AI superpower and a global creative hub.

At the heart of the report is a clear admission: the government’s preferred option, allowing AI developers to use copyrighted material unless rightsholders explicitly opted out, failed to win support.

The consultation attracted more than 11,500 responses, with the overwhelming majority of creators, publishers and rights organisations rejecting the proposal outright.

Ministers now concede that a broad exception “with opt-out is no longer the government’s preferred way forward”, citing strong industry opposition, lack of consensus, and insufficient evidence on economic impact.

This represents a notable victory for the UK’s creative sectors, from publishing and music to film and photography, which argued that such an exception would effectively legalise uncompensated use of their work by generative AI systems.

The report lays bare the fundamental policy dilemma: how to balance AI-driven economic growth with the protection of intellectual property.

On one side sit AI developers, who require vast datasets, often including copyrighted material, to train large language models and generative systems. On the other are creators whose works underpin those systems but risk being displaced by them.

The government acknowledges that modern AI models are typically trained on “billions of copyright works”, raising complex questions about fairness, consent and competition.

Yet it also highlights uncertainty around the economic benefits of reform, noting limited evidence that loosening copyright rules would materially increase AI investment in the UK.

In effect, ministers are choosing to pause rather than gamble.

Rather than legislating, the government is placing its bets on licensing, a market-based mechanism already beginning to take shape.

A growing number of deals between AI firms and content owners, particularly in publishing, music and image libraries, suggests a commercial model is emerging. However, the report acknowledges this market is still “new and evolving” and lacks transparency.

Crucially, ministers have ruled out direct intervention for now:

“We propose not to intervene in the licensing market at this stage… and will keep market-led approaches under review.”

This position aligns closely with industry sentiment across both creative and technology sectors, which broadly favour voluntary, negotiated agreements over statutory schemes.

However, it also raises important questions, particularly for SMEs and individual creators, about bargaining power and equitable remuneration.

Among those welcoming the shift is Tom West, CEO of Publishers’ Licensing Services (PLS), who sees licensing as both practical and scalable.

West said: “We welcome that the government has listened to the strong response it received from across the UK’s creative industries to its consultation and has stepped back from its preferred option of a copyright exception with an opt out and is to review the transparency of AI inputs, which would further boost licensing.

Whilst we await further clarity from the government on the long-term direction of its copyright policy, PLS will continue to serve our publishers and work with our partners on market-based, industry-backed AI licensing solutions.

This approach is already being put into practice. At the London Book Fair last week, PLS launched the first stage of a new collective licensing solution designed specifically to support the use of published content in AI. It was met with strong interest and positive feedback from publishers and industry partners, with publishers already beginning to sign up. The solution offers a practical, scalable way for AI developers to access high-quality content while ensuring creators are paid and retain control over how their work is used.

The case has not been made for the introduction of a new copyright exception. There is no market failure and a dynamic licensing market for the use of content in AI has developed and continues to grow. Any copyright exception for generative AI would jeopardise these licensing solutions, removing the ability of large and small rightsholders to receive payment for the use of their works in AI and reducing control over their content.

PLS welcomes the government’s engagement on this critical issue. We share a commitment to a mutually beneficial outcome and invite the government to work closely with us to help further develop and promote licensing options that support rightsholders of all sizes and AI developers seeking high-quality, trusted content.”

If licensing is the economic mechanism, transparency is the regulatory lever.

More than 90% of consultation respondents supported requirements for AI developers to disclose the sources of training data.

The government agrees, in principle, but stops short of immediate regulation. Instead, it proposes:
• developing industry-led best practice
• monitoring international frameworks (notably the EU AI Act)
• considering future legislation if needed

Transparency is seen as essential to enable enforcement, licensing and trust, particularly given that creators often have no visibility over whether their work has been used.

For UK businesses, particularly SMEs, the implications are nuanced.

For creators and publishers
• greater protection in the short term
• stronger negotiating position in licensing deals
• ongoing challenges around enforcement and visibility

For AI startups and developers
• continued legal uncertainty
• potential cost barriers to accessing training data
• reliance on licensed or overseas-trained models

For the wider economy
• slower regulatory clarity
• reduced risk of over-regulation
• continued dependence on global AI ecosystems

The report explicitly notes that SMEs on both sides, creators and developers, face disproportionate challenges under the current system.

Perhaps the most striking aspect of the report is its tone: cautious, iterative, and deliberately non-committal.

The government repeatedly emphasises the need for more evidence, more international alignment, and more market development before taking decisive legislative action.

With ongoing litigation in the US, new rules emerging in the EU, and rapid advances in generative AI, the UK risks being pulled in multiple directions, economically, legally and politically.

This is not a resolution, it is a holding position.

By stepping back from sweeping reform, the government has bought time. But it has also shifted responsibility onto the market to prove that licensing can work at scale, fairly and efficiently.

If it can, the UK may yet carve out a balanced model that supports both innovation and creativity.

If it cannot, the debate over copyright and AI will return, sharper, louder, and far harder to resolve.

Read more:
UK government backs away from AI copyright overhaul as licensing emerges as the battleground

Electric vessel manufacturer Candela has secured €30 million in fresh funding as soaring global fuel prices and growing pressure to decarbonise transport accelerate demand for next-generation maritime solutions.

The funding round, the company’s largest to date, brings total capital raised to €129 million and cements Candela’s position as the best-funded electric vessel manufacturer globally. The round was backed by existing investors including EQT Ventures, SEB Private Equity, KanDela AB and Ocean Zero LLC, alongside a new €8 million investment from the International Finance Corporation (IFC), part of the World Bank Group.

The capital injection will be used to finance a second manufacturing facility in Poland, enabling Candela to scale production of its hydrofoiling P-12 ferries and meet rapidly growing international demand.

The raise comes at a pivotal moment for the maritime sector, as volatile oil markets and rising fuel costs reshape the economics of waterborne transport. Investors are increasingly backing technologies that not only reduce emissions but also offer a clear cost advantage over traditional diesel-powered vessels.

Candela’s P-12 ferry represents a significant technological shift in this direction. Recently named one of TIME magazine’s most important inventions of 2025, it is the world’s first electric hydrofoil ferry operating in scheduled commuter service. The vessel uses a proprietary computer-controlled hydrofoil system that lifts it above the water’s surface, dramatically reducing drag and cutting energy consumption by up to 80 per cent compared with conventional ships.

The result is not only zero-emission travel, but also faster journey times and lower operating costs, a combination that is proving increasingly attractive to city transport authorities and private operators alike.

Founder and chief executive Gustav Hasselskog said the technology effectively creates an entirely new category of vessel, challenging centuries-old maritime design principles. By reducing reliance on fossil fuels and improving efficiency, he argued, the platform allows cities to unlock the full potential of their waterways without being constrained by high fuel costs.

The commercial viability of the model has already been demonstrated in Nordic markets, where the P-12 has been deployed in public transport systems across Stockholm, Gothenburg, Oslo and Trondheim. Early results show significantly reduced travel times and operating costs, alongside strong technical performance.

With serial production now underway and first customer deliveries beginning this month, Candela has built a growing order book of more than 65 vessels. From 2026, the company plans to expand into a range of international markets, including India, where a fleet of ten ferries is expected to cut travel times between Navi Mumbai Airport and the city centre from around two hours to just 35 minutes.

Further deployments are planned in the Maldives, Saudi Arabia’s NEOM project, Thailand and other regions, reflecting what the company describes as a global shift towards efficient, low-emission water transport.

Central to Candela’s growth strategy is its move away from traditional one-off shipbuilding towards scalable, platform-based manufacturing using advanced carbon-fibre construction. This approach allows the company to deliver high-performance vessels at a more competitive price point, addressing one of the key barriers to adoption in the maritime sector.

The involvement of the IFC also signals increasing institutional interest in sustainable transport solutions, particularly in emerging markets where infrastructure constraints and rising fuel costs present acute challenges.

Farid Fezoua, IFC Director for Equity, Funds and Venture Capital, said the investment reflects a broader push to accelerate the adoption of innovative mobility solutions while mobilising private capital and supporting job creation.

Meanwhile, investors highlighted the shifting macroeconomic backdrop as a key driver of the deal. Rising oil prices, exacerbated by geopolitical instability, are making traditional shipping models more expensive to operate, strengthening the case for electric alternatives.

EQT Ventures’ Marnix van der Ploeg noted that hydrofoil technology fundamentally alters cost dynamics, making electric vessels not just environmentally preferable but commercially superior in many cases.

Despite a broader slowdown in climate-tech investment globally, Candela’s successful raise underscores a growing distinction in the sector: technologies that can compete on cost and performance are continuing to attract capital, even as funding for more speculative or subsidy-dependent projects declines.

As global transport systems come under increasing pressure from both economic and environmental factors, Candela’s expansion signals that the maritime sector, long considered slow to innovate, may be entering a period of accelerated transformation.

Read more:
Candela raises €30m as electric ferries gain momentum amid fuel price surge

Rolls-Royce Motor Cars has abandoned its ambition to become a fully electric brand by 2030, marking a significant shift in strategy as the global transition to electric vehicles shows signs of slowing at the very top end of the automotive market.

The decision, confirmed by chief executive Chris Brownridge, reverses a high-profile commitment made in 2022 under his predecessor Torsten Müller-Ötvös, who had pledged that Rolls-Royce would cease production of its iconic V12 combustion engines by the end of the decade.

At the time, the company positioned its first electric model, the Spectre, as the beginning of a rapid transition, targeting 20 per cent of annual sales in the near term and as much as 70 per cent by 2028. The long-term ambition was clear: a complete shift away from internal combustion engines within eight years.

However, Brownridge has now acknowledged that the assumptions underpinning that strategy have changed materially. He pointed to a combination of softened customer appetite for fully electric luxury vehicles and a broader easing of regulatory pressure in key markets.

“For every client that loves an electric vehicle there is one who does not,” he said, underlining the continued demand among Rolls-Royce’s ultra-high-net-worth clientele for traditional powertrains. “Some clients do want an electric vehicle, we build what is ordered.”

The recalibration reflects a wider industry trend, particularly among premium and luxury manufacturers, where the pace of electrification is proving more uneven than previously anticipated. While mass-market brands continue to push towards electrification, high-end marques are increasingly adopting a more flexible, demand-led approach.

Brownridge was careful not to outline a revised electrification timeline, declining to specify new targets for zero-emission sales or confirm how many additional electric models Rolls-Royce plans to introduce. Nor did he disclose current sales performance for the Spectre, though its market reception has been closely watched as a bellwether for electric adoption in the luxury segment.

Instead, the emphasis appears to be shifting towards optionality rather than outright transition. The V12 engine, long synonymous with Rolls-Royce’s heritage and brand identity, will remain part of the company’s offering for the foreseeable future.

“The V12 is part of our history,” Brownridge said, suggesting that legacy and customer preference are now being given equal weight alongside environmental considerations.

The move comes amid a broader reassessment of electric vehicle strategies across the luxury automotive sector. Just a day earlier, Bentley confirmed that its own transition to an all-electric lineup would be delayed, with its first zero-emission model now expected at least two years later than originally planned.

Together, the announcements highlight a growing divergence between policy ambition and market reality. While governments continue to push for decarbonisation, including through bans on new petrol and diesel vehicles in the 2030s, manufacturers are increasingly signalling that consumer demand, particularly at the premium end, may not align neatly with those timelines.

Rolls-Royce’s original 2030 commitment was made at a time of strong political momentum behind electrification and rising optimism about battery technology, infrastructure rollout and customer adoption. Since then, a more complex picture has emerged, with concerns around charging infrastructure, range anxiety and the experiential differences between electric and combustion engines influencing buyer behaviour.

In the ultra-luxury segment, where emotional connection and heritage play a significant role in purchasing decisions, those factors appear to be even more pronounced.

Despite stepping back from a fixed deadline, Rolls-Royce is not abandoning electrification altogether. The Spectre remains a central part of its future portfolio, and the company is expected to continue investing in electric technology. However, the transition will now be paced according to customer demand rather than dictated by a hard deadline.

The shift underscores a broader reality facing the automotive industry: the road to electrification is unlikely to be linear. For Rolls-Royce, the strategy now appears to be one of balance, preserving its legacy while adapting to a changing, but still uncertain, future.

Read more:
Rolls-Royce scraps 2030 all-electric target as demand softens

The UK government is facing mounting political pressure to unlock £2.5 billion in proceeds from the sale of Chelsea Football Club, as opposition figures warn further delays risk undermining support for Ukraine.

The funds, frozen since 2022 following the forced sale of the club by sanctioned Russian oligarch Roman Abramovich, remain tied up in a legal and diplomatic dispute over how the money should be distributed. Ministers have now indicated they are preparing to take legal action to resolve the impasse after a March deadline passed without agreement.

Shadow chancellor Sir Mel Stride said the government “must not delay” in taking decisive steps to release the funds, arguing that the money should already have been deployed to support humanitarian efforts linked to Russia’s invasion of Ukraine. He warned that, more than two years after the sale, the continued freeze was becoming increasingly difficult to justify given the scale of need on the ground.

Abramovich was compelled to sell Chelsea in May 2022 after being sanctioned by the UK government in response to Vladimir Putin’s invasion. The club was acquired by a consortium led by US investor Todd Boehly in a deal worth £2.5 billion, with the proceeds placed into a UK bank account under strict government oversight.

At the time, Abramovich stated that the funds would be donated to support “all victims of the war in Ukraine”. However, the UK government has maintained that the full sum should be directed specifically towards Ukrainian humanitarian causes, creating a fundamental disagreement that has stalled progress.

Officials now appear to be losing patience. A government spokesperson confirmed that Abramovich had been given a final opportunity to resolve the matter voluntarily but had failed to do so, adding that further steps would now be taken to ensure the original commitments made during the sale are honoured.

The dispute has also been complicated by financial arrangements linked to Fordstam, the company through which Abramovich previously owned Chelsea. Filings suggest that less than £1 billion of the proceeds may ultimately be allocated to a charitable foundation after loan repayments, a position at odds with the government’s expectation that the entire sum should be used for humanitarian purposes.

The situation has become increasingly politically sensitive, particularly as the war in Ukraine continues and international support remains under scrutiny. Critics argue that the delay risks sending the wrong signal at a time when the UK has positioned itself as a leading supporter of Ukraine.

Stride’s intervention reflects broader concerns within Westminster that the issue has dragged on for too long. He pointed out that Labour has now been in power for 18 months without resolving the matter, despite repeated assurances that progress was being made.

The frozen funds represent one of the largest pools of Russian-linked assets held under UK sanctions, and the outcome of the case could set an important precedent for how such assets are treated in future. Legal experts suggest that any court action could hinge on the interpretation of sanctions law, charitable intent and the enforceability of commitments made during the sale process.

The controversy comes against the backdrop of continued scrutiny of Chelsea’s previous ownership. The club was recently fined £11 million and handed a suspended one-year transfer ban over undisclosed payments linked to the Abramovich era, although no players were found to have committed wrongdoing.

For now, the £2.5 billion remains frozen, symbolising both the complexity of sanctions enforcement and the challenges of converting political commitments into tangible outcomes. With ministers now signalling a willingness to escalate the matter through the courts, the next phase of the dispute is likely to be fought in the legal arena rather than through negotiation.

Read more:
Government urged to act as £2.5bn Chelsea sale funds remain frozen

Trustpilot has emerged as an early beneficiary of the shift towards artificial intelligence-led search, reporting a sharp rise in profits and a surge in its share price after a year of strong growth driven by increased exposure through large language models.

Shares in the consumer review platform jumped as much as 28 per cent following results that beat market expectations, as investors responded positively to signs that the business is successfully adapting to the changing dynamics of online discovery. The company posted pre-tax profits of $14.1 million for the year to December, up significantly from $5.2 million the previous year, underpinned by stronger customer retention and a shift towards higher-value contracts.

Revenue rose 24 per cent year-on-year, with growth recorded across the UK, Europe and the United States. Trustpilot also reported a 16 per cent increase in average annual contract value, reflecting its success in moving upmarket and monetising its platform more effectively.

Central to that performance has been the company’s growing visibility within AI-powered search environments. Trustpilot said click-throughs from AI-driven platforms increased more than fifteenfold over the past year, highlighting how rapidly consumer behaviour is shifting away from traditional search engines towards conversational interfaces powered by large language models.

The company has actively opened its data to these platforms, allowing its reviews to be surfaced within AI-generated answers. According to Promptwatch data, Trustpilot ranked as the fifth most cited domain globally on ChatGPT in January, a position that has significantly enhanced its reach and relevance.

Chief executive Adrian Blair described artificial intelligence as a “major tailwind” for the business, noting that visibility within AI search has become a key selling point when engaging with clients. As businesses increasingly focus on how they appear within AI-generated responses, Trustpilot’s repository of verified consumer feedback has become a valuable asset in the emerging search ecosystem.

Analysts suggested the results offer an early indication that the transition from traditional search to AI-led discovery could create new winners, particularly for platforms built around user-generated content. Investec analysts noted that Trustpilot’s performance demonstrates how this shift could benefit businesses whose data is highly relevant to AI-driven queries.

Alongside its earnings growth, Trustpilot announced a £30 million share buyback programme, including £7.5 million allocated to its employee benefit trust, signalling confidence in its financial position and long-term prospects. The company also upgraded its medium-term profitability targets, forecasting that its adjusted EBITDA margin will rise from 15.6 per cent in 2025 to 25 per cent by 2028 and 30 per cent by 2030.

The strong results mark a rebound after a turbulent period for the company’s share price. In December, Trustpilot faced scrutiny following claims by short-seller Grizzly Research alleging questionable practices in its dealings with non-paying customers. The company strongly denied the allegations and issued a detailed rebuttal, helping to stabilise investor sentiment after an initial sell-off.

The stock was also caught in a broader downturn affecting software companies earlier this year, but the latest results suggest Trustpilot may be structurally better positioned than many peers in an AI-driven market.

Blair emphasised that the company’s core proposition remains fundamentally distinct from other technology businesses. While AI can aggregate and present information, he argued, it cannot replicate the real-world customer experiences that underpin Trustpilot’s platform.

As artificial intelligence continues to reshape how consumers search, discover and evaluate brands, Trustpilot’s ability to embed itself within that ecosystem appears to be driving both immediate performance gains and longer-term strategic value.

Read more:
Trustpilot profits soar as AI-driven traffic fuels sharp share price rally

Stepping away from a long and successful career in Big Four and national accountancy firms is no small decision, yet that is exactly what Greg McNally did when he founded VITA.

Today, he leads one of the UK’s largest independent VAT and indirect tax advisory businesses, built on a simple but powerful principle: understanding clients first, then delivering real value. With more than two decades of experience, McNally has seen the profession evolve dramatically, and set out to challenge the status quo with a consultancy that prioritises relationships, authenticity, and commercially focused advice in an increasingly complex tax landscape.

McNally is Managing Partner and founder of VITA, a Glasgow-headquartered specialist firm of VAT and indirect tax advisors. With a combined 85+ years of experience across the team, VITA is now the largest independent VAT and indirect tax consultancy in Scotland and one of the largest in the UK.

Rather than focusing purely on compliance, VITA specialises in high-value advisory work, helping businesses navigate complex tax strategy, transactions, and commercial decision-making. The firm works closely with clients at the earliest possible stage of projects, ensuring tax is considered proactively rather than retrospectively.

That said, the team is equally adept at stepping in when challenges arise, whether that’s limited options late in a deal cycle or managing HMRC enquiries. Known for its pragmatic, commercially minded approach, VITA combines deep technical expertise with a problem-solving mindset to deliver clarity, confidence, and value.

What was the inspiration behind VITA?

I founded VITA in 2019 after a 20-year career with Big Four and a national accountancy firm, where I reached partner level.

Over that time, I saw the profession change significantly. Accountancy services have increasingly become commoditised, and in many cases, the depth of client relationships has diminished. Earlier in my career, accountants were often trusted advisers, people who genuinely understood their clients’ businesses and were part of their wider journey.

VITA was created in response to that shift. The goal was to build a firm that prioritises understanding—understanding our clients’ motivations, challenges, and ambitions—and then adding value through insight, not just process. That ethos still underpins everything we do today.

Who do you admire?

The clients I’ve worked with over the past 25 years.

Particularly those who’ve built something from nothin, who identified a gap in the market, challenged convention, and had the belief to bring their vision to life. I’ve always found their origin stories fascinating. There’s something incredibly powerful about that combination of resilience, creativity, and determination.

Looking back, is there anything you would have done differently?

No. Every mistake is a learning point, and I wouldn’t wish any of them away.

Life is a process of joining the dots, you can always look back and understand how you got to where you are. Looking forward is a different story. Plans rarely unfold exactly as expected, so the real skill lies in being agile, adapting quickly, and responding to what’s in front of you.

What defines your way of doing business?

Traditional values in a modern, fast-paced environment.

At its core, business is quite simple: listen to your clients, understand what they actually need, not what you want to sell them—and then deliver exactly what you promised, on time and on budget.

The challenge lies in scoping work properly and communicating clearly throughout the process. Don’t overpromise. Don’t overcommit. Be honest, be authentic, and do the right thing.

At VITA, we live by two mantras:
“Say what you do and do what you say” and “Do the right thing.”

What advice would you give to someone starting out?

You can’t learn experience—you have to live through it.

Early in my career, I focused heavily on learning—building knowledge, developing skills, and growing my network. That phase takes time, and there are no shortcuts. But the rewards come later.

Put the work in early, stay curious, and be patient. The return on that investment will follow.

Read more:
Getting To Know You: Greg McNally, managing partner, Vita

The Treasury’s proposed overhaul of the Financial Ombudsman Service (FOS) has come under scrutiny from senior MPs, who have warned that the reforms risk undermining the independence of a body tasked with resolving disputes between consumers and financial firms.

In a letter to City minister Lucy Rigby, Dame Meg Hillier, chair of the Treasury Select Committee, raised concerns that key elements of the government’s proposals could fundamentally alter the role and perceived neutrality of the ombudsman. The reforms, unveiled earlier this week, are intended to address criticism that the FOS has evolved into a “quasi-regulator” rather than a complaints resolution body. However, MPs argue that the changes could have unintended constitutional consequences.

At the centre of the criticism is a proposal that would see the chair of the FOS appointed directly by government. Hillier warned that such a move risks eroding both the actual and perceived independence of the institution, which plays a critical role in adjudicating disputes across the UK’s financial services sector.

Writing on behalf of the committee, she emphasised that the ombudsman “must be and must be seen to be an independent mechanism” for resolving complaints, highlighting that public trust in the system depends on its ability to operate free from political influence.

The committee has called for additional safeguards, including the introduction of a statutory “lock” that would give Parliament, specifically the Treasury Select Committee, the authority to approve or veto the appointment and dismissal of the FOS chair. Such mechanisms are already in place for other oversight bodies, including fiscal and audit watchdogs, and are designed to reinforce institutional independence.

Hillier also questioned why the proposal for government appointment was not included in earlier consultation processes, seeking clarity on what prompted the shift in approach. The intervention reflects broader unease within Westminster about the balance between reforming regulatory bodies and preserving their autonomy.

The debate comes at a sensitive time for the Financial Ombudsman Service, which has faced significant internal upheaval over the past year. Former chief executive Abby Thomas departed abruptly in February following what was described in a Treasury Committee report as a “mutual collapse in confidence” between her and the board over strategic direction. Shortly afterwards, chair Baroness Zahida Manzoor announced she would step down at the end of her term, leaving the organisation’s senior leadership largely in interim positions.

MPs have now sought assurances on whether the proposed reforms would apply to forthcoming permanent appointments, raising concerns about governance stability during a period of transition.

Alongside the governance changes, the Treasury’s reform package includes a series of structural adjustments aimed at reshaping how the FOS operates. These include the introduction of a 10-year time limit for bringing complaints, with the Financial Conduct Authority (FCA) retaining discretion to make exceptions in certain cases.

The government has also begun implementing changes to the cost structure of the ombudsman system. Since April, professional representatives such as claims management companies and law firms have faced a £250 fee for each case submitted beyond an initial allowance, while financial institutions are exempt from fees on their first three complaints each year before incurring a £650 charge per case thereafter.

Ministers argue that these measures are designed to improve efficiency, reduce speculative claims and refocus the FOS on its core function. However, critics warn that the cumulative effect of the reforms — particularly changes to governance — could reshape the institution in ways that weaken its independence and credibility.

The Treasury Select Committee has made clear that it expects a detailed response from the government, particularly on how it intends to safeguard the ombudsman’s impartiality while pursuing its wider reform agenda.

Read more:
MPs warn Treasury reforms risk undermining Financial Ombudsman independence

Close Brothers has announced plans to cut around 600 job, equivalent to roughly a fifth of its workforce, as the lender accelerates a sweeping cost-cutting programme in response to mounting pressure from the motor finance mis-selling scandal.

The restructuring, confirmed by chief executive Mike Morgan, will reduce headcount to approximately 2,000 over the next 21 months and is intended to restore investor confidence following renewed scrutiny of the group’s potential compensation liabilities. The move comes amid heightened market volatility after short-seller Viceroy Research claimed the lender’s total compensation bill could reach as high as £1.23 billion, far exceeding the company’s current £300 million provision.

Shares in Close Brothers have come under sustained pressure, falling sharply at the start of the week and continuing to slide as investors digested the scale of potential exposure. The lender is widely regarded as one of the most exposed UK financial institutions to the car finance scandal relative to its size, with motor loans accounting for around £2 billion of its £9.5 billion loan book.

The scandal, which first emerged two years ago, centres on the failure of lenders to adequately disclose commission arrangements paid to car dealers for arranging finance. The Financial Conduct Authority is expected to set out its final redress scheme imminently, with earlier estimates suggesting the total industry bill could reach £11 billion.

Morgan defended the bank’s approach to estimating its liabilities, insisting that its £300 million provision reflects a probability-weighted assessment in line with accounting standards and supported by legal and audit advice. However, the refusal to disclose detailed assumptions behind that figure has fuelled scepticism among investors and opened the door for more aggressive external estimates.

The chief executive dismissed Viceroy’s analysis but acknowledged the uncertainty surrounding the final outcome. He said the eventual cost could be “materially higher” or “materially lower” depending on how the regulator structures compensation and how many borrowers come forward with claims.

Against this backdrop, Close Brothers is moving aggressively to reshape its cost base. The group has already divested its Winterflood broking arm and its asset management business, scaled back growth plans and suspended its dividend in an effort to conserve capital. The latest measures will focus on streamlining operations across its core divisions, including retail lending and commercial finance, where the bulk of job losses are expected to fall.

The restructuring will incur an upfront cost of around £25 million but is expected to deliver annual savings of £60 million by the end of 2027. The company said it would centralise shared services, reduce reliance on third-party providers and cut property and operational expenses as part of a broader efficiency drive.

Artificial intelligence is also set to play a growing role in the transformation, with the bank aiming to deploy AI tools “at pace” to reduce costs and improve customer experience. The move reflects a wider trend across the financial services sector, where firms are increasingly turning to automation and digitalisation to offset rising regulatory and operational pressures.

Despite the cost-cutting programme, Close Brothers reported a mixed set of interim results. The group posted a statutory loss of £65.5 million for the six months to January, an improvement on the £102.2 million loss recorded a year earlier. Adjusted operating profit fell to £65.2 million, down from £80.5 million, reflecting ongoing headwinds.

Its core capital ratio improved to 14.3 per cent, comfortably above regulatory requirements, providing some reassurance on balance sheet strength. However, analysts warn that a significantly higher compensation bill could erode that buffer and materially impact shareholder value.

The situation has drawn comparisons with the payment protection insurance (PPI) scandal, which ultimately cost UK banks more than £50 billion, far exceeding initial provisions and leaving investors wary of underestimating liabilities in mis-selling cases.

Morgan insisted that lessons from the PPI episode had informed the bank’s current approach, arguing that regulatory scrutiny and accounting standards are now far more rigorous. Nonetheless, the combination of regulatory uncertainty, investor scepticism and operational restructuring highlights the scale of the challenge facing the lender.

With the FCA’s final ruling imminent and market confidence fragile, Close Brothers is entering a critical period that will determine both the ultimate financial impact of the scandal and the success of its efforts to rebuild credibility with shareholders.

Read more:
Close Brothers to cut 600 jobs as motor finance scandal pressures finances

A significant ownership shift has taken place at The Economist Group after Canadian billionaire Stephen Smith agreed to acquire a 26.9 per cent stake from Lynn Forester, Lady de Rothschild, marking the first major change in the publisher’s shareholder structure in more than a decade.

Smith, 74, is purchasing the stake through his family investment vehicle, Smith Financial, in a deal that underscores continued global investor confidence in one of the world’s most influential media brands. While financial terms have not been disclosed, the transaction represents a notable reshaping of the group’s ownership, with the Rothschild family exiting a long-held position.

The move follows the last major ownership change in 2015, when Pearson sold the majority of its 50 per cent holding to the Agnelli family’s investment company, Exor, which today remains the largest shareholder with a 43.4 per cent stake. Smith’s investment now positions him as one of the most significant minority shareholders alongside Exor, reinforcing a shareholder base that blends long-term strategic investors with a commitment to editorial independence.

Founded in 1843, The Economist Group has built its reputation on championing free trade, liberal economics and independent journalism. That editorial positioning has historically shaped its ownership model, with shareholders often selected not only for financial backing but for alignment with the publication’s values and governance principles.

A spokesperson for Smith confirmed that the investment reflects his “full support for The Economist’s longstanding tradition of rigorous editorial independence”, a key consideration in any change of ownership at the publication. Maintaining that independence is central to the group’s structure, with safeguards embedded in its governance to ensure editorial decisions remain insulated from shareholder influence.

Lady de Rothschild’s decision to sell is understood to be part of a broader reorganisation of her family’s investment portfolio. A prominent figure in international finance and philanthropy, she co-founded telecoms business FirstMark Communications and has held senior roles including a position on the board of Estée Lauder. Alongside her late husband, Sir Evelyn de Rothschild, she also built EL Rothschild, a family office with interests spanning private equity, public markets and real estate.

Smith, meanwhile, brings deep experience in financial services and investment. He co-founded First National Financial Corporation in 1988, building it into one of Canada’s largest non-bank mortgage lenders, and stepped down from its board in 2025. His wider portfolio includes chairmanship roles at Peloton Capital Management, proxy advisory firm Glass, Lewis & Co, and Fairstone Bank of Canada, a major consumer lending institution.

Beyond business, Smith is also known for his philanthropic activity, particularly in education, heritage and the arts, areas that align with The Economist Group’s broader intellectual and cultural influence.

The Economist Group confirmed the agreement, noting that completion remains subject to standard closing conditions. The company did not comment on valuation but emphasised continuity in its strategic direction and governance framework.

The transaction comes at a time when premium media brands continue to attract high-net-worth investors seeking exposure to trusted global content platforms with diversified revenue streams, including subscriptions, events and specialist research services.

For The Economist, the arrival of a new cornerstone investor signals stability rather than disruption. With its ownership model designed to prioritise long-term stewardship over short-term returns, the addition of Smith Financial is expected to reinforce the group’s financial resilience while preserving the editorial principles that have defined it for more than 180 years.

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Canadian billionaire Stephen Smith takes 27% stake in economist group