UK firms race into AI as Peter Kyle urges regulators to keep pace
Tech consultancy firm Capgemini has urged that, despite businesses racing to roll out generative artificial intelligence (genAI), most remain aptly unprepared for the governance challenges it will bring.
This warning comes just as the UK government leans on the technology to sharpen its competitive edge and cut red tape.
The French consultancy’s AI survey, published on Friday, revealed that 61 per cent of global firms plan to increase investment in genAI over the next twelve months.
Nearly a third have already scaled this technology across their operations, which is a fivefold jump in just two years.
Yet, the report also found major blind spots, with only 28 per cent of companies having the right legal teams in place to tackle thorny issues around intellectual property and copyright.
What’s more, fewer than half have set up governance frameworks to manage AI use, and even those often struggle to enforce them.
Franck Greverie, Capgemini’s chief technology and portfolio officer, warned that rapid adoption “doesn’t necessarily translate into large-scale deployment with tangible ROI”, unless firms strengthen their data foundations and build “a trusted environment that’s compliant, secure and ensures necessary privacy”.
UK prioritises innovation
In the UK, executives appear bullish on AI’s potential, as 84 per cent of British firms expect AI ‘agents‘ – autonomous systems working alongside humans – to manage at least one business process within the next three to five years, outpacing global rivals.
Over half said the technology’s benefits outweigh its environmental costs, which is slightly above the global average.
But the report’s warnings come as ministers urge regulators to embrace AI, and double down on its regional investment.
At the innovation and technology dinner at Mansion House this week, tech secretary Peter Kyle announced £2.7m in funding for watchdogs to trial AI tools in areas ranging from aviation safety to nuclear oversight.
Kyle argued that adopting AI could slash approval times for new products and services, boosting Britain’s appeal to fast-growing tech firms.
“Too often British innovators are waiting months for approvals whilst competitors overseas race ahead”, he told industry leaders.
Business groups welcome efforts to streamline oversight but warn ministers not to oversell what AI can achieve.
Ben Bilsland, head of technology at RSM UK, said: “Streamlining approvals is welcome, but there’s a danger of overselling what AI can deliver. Regulators need the resources and independence to use these tools responsibly”.
Global competition heats up
The Capgemini findings add weight to fears that companies could stumble if regulation fails to keep pace.
The report shows firms are increasingly turning to smaller, cheaper AI models to avoid “bill shocks” as cloud costs balloon, evidence of a market still finding its feet.
For the UK, the stakes are high.
Government figures show more than 14,000 new tech firms launched in the second quarter, while a Barclays survey found most executives now see Britain as a more attractive base than the US or Europe.
But as Capgemini’s research underlines, ambition is not the same as readiness.
Without stronger guardrails, experts warn both businesses and regulators risk being caught flat-footed in a global AI race that shows no sign of slowing.