He made the comments in a speech at the PIMFA Wealth of Diversity Conference, in London, yesterday, admitting the regulator had slipped on its median pay gap targets.

“In 2017, our median gender pay gap was 20.9%, last year it was 21.2%. So yes, we went backwards by 0.3%.

But he said despite the challenges the regulator was making progress in many areas and much would change over the next seven years.

He said: “Currently, 39% of our senior leaders are women, and our target is to get to 45% by 2020 and 50% by 2025.

“We aim for 8% of our senior leaders to identify as BAME by 2020, rising to 13% by 2025. Currently the number is 5%.

“We have more to do as you can see, but our direction of travel is right. And, I have no doubt that it makes us a better organisation.”

The FCA is an active participant in the Women in Finance Initiative and last June was joint winner of the Women in Finance Employer of the Year Award.

He told delegates: “Diversity and inclusion is central to how we act as a regulator and as an employer.

“Fostering a culture of diversity and inclusiveness can contribute to changing the behaviour of firms for the better. The culture and governance of firms is a priority for us but we do not prescribe what this should be.”

He added: “We don’t respect institutions – private or public – because they have been around for a long time, or because they are populated by a certain sort of person.

“We put a much more tangible value on the practice of diversity – of people, backgrounds and experience, opinions and thinking, and rightly so.”

He said a diverse corporate culture and different values could guard against “groupthink” and provide a challenge to bad practices.

He added: “There is no doubt in my mind that we will be more successful if we pursue diversity and inclusion with a passion for succeeding.”