Insurance company director’s top three worries

Insurance company director’s top three worries | Insurance Business

Insurance company director’s top three worries
As a director of AMI Insurance and IAG (New Zealand), Doug McKay is in a good position to share some of the top concerns he and his fellow directors will be thinking about in the upcoming year and beyond.

Talking to Board Dynamics CEO Henri Eliot, McKay revealed his number one concern was health and safety.

“First and foremost, given legislative change, is to ensure Health and Safety is right up to scratch and use this opportunity to focus on risk more generally,” he told Eliot for the New Zealand Herald.

“Health and Safety is a platform to leverage improvements, processes and disciplines around risk and to move towards positive culture change.”

McKay, who is also chairman at BNZ and a director at Genesis Energy, said all his businesses were facing disruption threats and opportunities this year.

“We need to be nimble, agile, and adaptive to capitalise on these.”

He had strong words to detail his third biggest concern which was growth and innovation.

“If you’re not growing you are dying. The relentless search for profitable growth continues,” he said.

The other professional directors polled by Eliot included Mark Verbiest, chairman at Spark and Transpower, and director of ANZ Bank New Zealand and Freightways; Tony Carter, chairman at Air New Zealand and Fisher & Paykel Healthcare and a director of Fletcher Building and ANZ Bank New Zealand; and Rob Campbell, chairman of Summerset and director of Turners and Growers and Precinct Properties.

Verbiest and Carter cited cyber security as one of their top concerns (#2 and #3 respectively), something that is also a hot topic in the insurance industry.

Verbiest said the subject has ‘massive’ focus at Spark ‘given the importance of protecting customer and our own information’.

“It is an issue that requires constant focus,” he said. “New threats evolve all the time and we don’t know what we don’t know.

“Regular reporting and keeping up to date with the latest trends and preventative methods is critical.”

Similarly, Carter felt cyber security risk was set only to grow, and pointed out that our geographic isolation was no protection.

“Companies will need to invest more time and resource to mitigate this risk,” he concluded.

Rob Campbell had a blunt message for directors who he said ‘should never worry’.

Paraphrasing Eldridge Cleaver, he said they risked making themselves part of the problem rather than part of the solution.

“If a director wakes up at night worrying they should move to another role.

“We have responsibilities as a director for sure but we meet those and move on. Executives and staff have enough to cope with without worry-wart directors adding to the problem,” he said.

Eliot said he was not surprised by the directors’ concerns.

“These are the hot topics that Board Dynamics has helped boards through implementing new or improved risk management reporting for a number of boards,” he told Insurance Business.

“We have also provided training on cyber security and health and safety.”

Eliot added that while Campbell’s comments had a slight humorous edge, the underlying message was important.

“Directors need to stay focussed but should not get stressed by these issues.

“The focus is on managing and/or mitigating risks, in addition to identifying opportunities or required strategic changes,” he said.