Nick Lyons, chair of the insurer Phoenix, has been picked as the next lord mayor of London despite concerns whether he was eligible for the role as an Irish citizen.

On Tuesday, the City of London Corporation’s Court of Aldermen chose to support the City grandee rather than his younger rival Tim Hailes, who has run for the role in successive elections.

Lyons’ appointment still needs to be voted on by the historic livery companies of London, although City insiders regard this as a rubber stamping of the decision by the aldermen.

People familiar with the vote said it had been a very close choice between Lyons and Hailes, both of whom have worked at JPMorgan. Lyons was also a banker at Lehman Brothers.

A letter sent to City leaders on Tuesday seen by the FT confirmed the decision, saying: “[The] court agreed that Nicholas Lyons shall be supported for the mayoralty in 2022-23, subject to an election at Common Hall in 2022”.

Lyons is set to become the City’s 693rd lord mayor in 2022 after Vincent Keaveny, a partner in DLA Piper’s Finance practice, who will succeed current mayor William Russell in October.

The closed door election process by the 24 aldermen was thrown into question when senior City leaders raised concerns over the eligibility of Lyons as an Irish citizen.

The 2013 Act Of Common Council, which sets out eligibility for aldermen defines them — and so the lord mayor — as needing to “be a British subject”. But the City took legal advice that the act does not stop a non-British citizen holding the post, through qualifications as a freeman of the City which under EU law was extended to citizens of the EU.

The election process also attracted controversy during the first attempt, the last time there was an election in 2018, by the openly gay Hailes to become the lord mayor after he was asked questions relating to his sexuality.

Hailes said in a statement that he remained “wholly committed to the civic city as alderman for the ward of Bassishaw”. He added:

“As an active member of the policy and resource committee, the police authority board and chairman of the board of lord mayor’s show limited, I will continue to proudly and enthusiastically play my full part in civic life.”

Lyons was not available for comment.

The lord mayor title carries considerable responsibility in representing the City and in meetings with global leaders. The candidate often receives a knighthood after taking the unpaid role, and is allowed to live in the Mansion House residence in the centre of the Square Mile.

The City of London has faced accusations of being an old boys club given that only four of the 25 people who normally comprise the aldermen are women, although the number is currently 24 following the death of banker Roger Gifford. Only two women have been elected to the position in its 832-year history. Russell is the fifth member of his family to have held the title. He had his tenure extended by a year owing to the pandemic.