Financial Conduct Authority chief executive Nikhil Rathi has defended his ambitious project to overhaul the regulator’s culture in front of MPs, but said he is conscious of the risks of staff leaving amid a planned revamp to their pay and perks.

Rathi has instituted a widespread ‘transformation agenda’ at the watchdog, since taking over in October 2020, in a bid to react faster to the kind of scandals that have seen its reputation tarnished over the past few years.