Lazard UK CEO and Co-Head of European Financial Advisory Cyrus Kapadia publishes op-ed in The Times of London

On May 29, The Times of London published an op-ed written by Cyrus Kapadia, Lazard UK CEO and Co-Head of European Financial Advisory. In the piece, Cyrus explains the important need to align the UK’s financial system with the country’s long-term economic priorities, by strengthening public investment tools, reforming pension asset strategies, and creating a stable policy framework to unlock private capital to drive UK national development.

Click here to read the op-ed in The Times. Alternatively, read the full piece below.

UK needs a renewed relationship between finance and enterprise 

Promising businesses can struggle to access long-term capital they need to scale and compete, so we must act so they can access the funds they need to thrive

By Cyrus Kapadia

Britain’s financial services industry is one of the jewels in the nation’s economic crown. London is a global financial powerhouse—home to world-class talent, deep capital markets, and international acclaim. But while the City thrives on the global stage, the UK’s financial system sometimes fails to serve the country’s own long-term economic needs.

The UK is not uniquely short-termist — financial markets around the world face similar pressures. What sets the UK apart is a dearth of mechanisms that many peer nations use to counterbalance it.

The UK has no sovereign wealth fund as well as underpowered public investment tools and pension funds that have long been steered away from growth assets and domestic opportunities. Promising UK businesses can struggle to access the long-term capital they need to scale and compete. If we want to unlock Britain’s full potential, we must position market incentives together with national growth priorities.

There has been some recent progress. UK business investment has risen nearly 6 per cent this year, reversing a long-standing trend that placed Britain near the bottom of the G7 in private investment. The Financial Conduct Authority’s pledge to reduce red tape and simplify regulations is welcome. But reform must go further, targeting not only ease of public listings, but the full lifecycle of business growth, from startup to scale-up to sustained innovation.

The government has a critical role to play. Bold, targeted incentives are needed to stimulate long-term economic growth and crowd in private capital. The private sector contributes a significant portion to the UK’s GDP — and so already plays an important part in driving the UK’s economic output and growth. But business is still feeling the impact of recent employer tax hikes, which act as a tax on jobs and, by extension, on growth.

We must also rebalance our focus. Attracting global capital to the City is important, but not enough. We need a strategy not just to entice growth companies, but to retain them — reviving the UK’s equity markets as a destination for scale and success. We must also ensure that businesses across the UK — especially in emerging sectors and less-served regions — can access the funds they need to thrive.

UK pensions control more than £3 trillion in assets, yet regulatory and accounting constraints have long encouraged low-risk, often offshore investments. Shifting even a modest share of that capital toward high-growth domestic firms could transform the investment landscape. The goal should be to reform the system so that domestic investment is a viable, attractive option when it offers strong long-term value. The recently announced Mansion House Accord is a step forward. But voluntary measures may not be enough. I support the chancellor’s recent pledge to consider action where pension funds fail to engage.

Britain’s roads, railways, energy grid, and digital networks are overdue for investment. The new National Wealth Fund aims to catalyse private investment, but it must be backed by a stable, long-term policy framework. Investors need certainty that rules and incentives will endure across political cycles. Without this, the scale of capital required — running into the hundreds of billions — will remain out of reach. Regulatory unpredictability is a major deterrent to global investors. Britain must become a reliable partner for long-term infrastructure investment.

So what Britain needs now is a renewed relationship between finance and enterprise. The financial sector must become a more active partner in long-term value creation, not just global capital attraction. Government must create an environment where private investment is rewarded for supporting domestic innovation, infrastructure, and clean energy. Whether the challenge is equities, pensions, or public infrastructure, the same principle applies: a co-ordinated approach, built on trust and long-termism, that positions the UK as the place in the world to start, grow, and sustain a business.