UK Financial Conduct Authority Chair urges joint international testing and crisis coordination to address shared systemic risks

Financial Conduct Authority (FCA) Chair Ashley Alder called for closer international supervisory cooperation to address risks spreading across firms, sectors and borders through shared dependencies. Speaking at the Michael D. Gill Lecture on International Financial Regulatory Understanding and Cooperation, he argued that regulation organised primarily around individual sectors and jurisdictions leaves gaps when shocks originate outside financial services. Regulatory simplification to support growth should not weaken resilience, particularly where firms depend on common cloud providers, data sources and artificial intelligence models. Alder proposed three priorities: building shared intelligence, conducting joint tests and establishing mechanisms for coordinated crisis action. He called for regular exercises covering cyberattacks, cloud outages and disruption in digital money, involving financial firms, market infrastructure and critical third parties where relevant. Legal gateways, data sharing standards and crisis protocols should be established before threats materialise. Domestically, the FCA is examining whether its regulatory perimeter covers the right activities and whether existing powers can address risks originating outside finance. This discussion builds on the existing UK critical third parties regime, under which the FCA, Bank of England and Prudential Regulation Authority oversee designated providers’ critical services. Alder highlighted major cloud providers already covered by that regime and raised the question of whether dependencies on AI models, data providers and social media platforms warrant further regulatory attention, without announcing an expansion.