Diversity in re/insurance: Rising to the challenge, and reaping the benefits
The backdrop of the pandemic will make this an unusual International Women’s Day for many of us. But with research showing COVID-19 is exacerbating gender inequality, I believe it’s more important than ever that we take the time to reflect on the progress we’ve made as an industry and consider the work that remains to be done.
Now in its third year, recent research by the Swiss Re Institute on Gender diversity in the re/insurance industry examines women’s representation and participation in the insurance sector. This report looks specifically at gender equality in the senior leadership of insurance organisations, and how this impacts performance.
After more than two decades in the industry, I am pleased to see the findings confirm my sense that we’ve come a long way and are heading in the right direction. The presence of women at the executive level has increased significantly in virtually all segments of re/insurance over the past 10 years. In fact the average share of women on the boards doubled from 13% in 2010 to 26% in 2019, while women’s share of the C-suite climbed from 10% to 17%. In some segments, notably reinsurance, the proportions are even higher.
Source: Swiss Re Institute, Refinitiv
I’m especially proud to see some Asia Pacific markets leading this charge. In New Zealand, for example, around half of CEOs and 39% of C-suite executives at life insurers are women, some of the highest rates among the markets covered in the research. Australia is also an outperformer in some respects, with women making up almost a quarter (23.7%) of insurance industry board chairpersons, versus a global average of just 8%.
On the other hand, there’s no question that across our region, many of these numbers are still too low. The research shows that in Australia, Japan and India, less than 10% of CEO positions at re/insurers are held by women. In China women account for 17% of C-suite positions at re/insurers; less in Japan and India.
We need to work harder to change this – not only because it’s the right thing to do, but also because, as the research shows, it makes direct contributions to shareholder value. Our data analysis found a 10% increase in the share of women at the C-suite executive or board level is clearly correlated with above industry average profitability. Re/insurers with the highest proportion of women leaders outperform the return on equity of those with the lowest by as much as 5 percentage points.
Why change is imperative
Considering all the other benefits of gender equality, from the ability to introduce more perspectives in decision-making, to strengthening governance and meeting stakeholder demands for sustainability, it couldn’t be clearer that we as an industry and a region need to make diversity a strategic priority.
We can build on and accelerate the already substantial progress we’ve made in multiple ways, including setting – and sticking to – measurable gender-specific hiring and promotion goals; identifying future women leaders early in their careers and supporting their development; and taking advantage of the shift to remote working to enable all employees, not just women, to balance professional and personal commitments.
There’s no doubt the pandemic has brought formidable challenges, for working women in particular. But it’s also helped us question many of our old assumptions, and shown that when called on to change, we can rise to the occasion.
It’s my hope that we can resolve on this rather exceptional International Women’s Day to ensure part of the legacy of COVID-19 is positive, by pursuing our goal of fostering an inclusive, diverse and supportive workplace for everyone with renewed determination. By striving to create an environment of balance and equality, we will strengthen our governance, profitability and sustainability for the long term - an outcome that will ultimately benefit all of us.