Inside-out broking – Why a strong compliance framework is key to future growth

CEO and new director weigh in on the lay of the regulatory landscape

Inside-out broking – Why a strong compliance framework is key to future growth

Business Resilience

By Mia Wallace

When Broadway Insurance Brokers announced named Gary Ward (pictured left) as its new director of operations, internal audit, risk and compliance, CEO Daniel Lloyd-John (pictured right) said the appointment sends a “strong, clear signal” to the market about the business’s ambitions.

With an insurance career spanning four decades, Ward is a long-standing insurance and compliance stalwart who has seen the market’s regulatory landscape through many iterations. Speaking with Insurance Business, Ward, who is also currently deputy chairman of the Manchester Committee of BIBA, noted that his role at Broadway is essentially to translate the FCA’s requirements into meaningful action.

Supporting Broadway’s growth ambitions

It’s a clear show of ambition that Broadway is making this investment into creating a strong client compliance framework so relatively early in its journey, he said. The task at hand for him is to ensure the firm has all the correct conduct policies and best practice guides in place and that its HR function is running in accordance with compliance requirements, while also looking at all its business processes through the development of a full process guide for staff.

“I'll be flowcharting everything, so everybody will understand how a file or a customer needs to be handled from cradle to grave and how to satisfy all the regulatory requirements that sit in between,” he said. “It's a full picture I’m creating; its operations, compliance and its HR as well – and it’s about recognising that they’re all interlinked together.”

What’s happening in the regulatory landscape?

Regulation has been a hot-button topic for the industry in 2023, particularly amid the rollout of new Consumer Duty guidance in July. Looking at the regulatory landscape facing the insurance broking market today, Ward noted how heavily regulated the insurance industry is in the UK. Firms like Broadway are recognising the need to strengthen their existing compliance frameworks, he said, and underpinning this commitment is a pledge to put the customer at the heart of everything they do.

“That’s what the FCA wants to see as well – that the customer is at the heart of all our processes, that we’re always thinking about how [our actions] are affecting the customers, about whether they understand the products they’re purchasing properly and whether they’re been given the right information to make an informed decision," he said. “So, my role is to make sure we put the right foundations in place.”

Ward noted that it was Lloyd-John’s vision for Broadway and his commitment to enacting that vision in a structured, thoughtful and ethical manner that drew his attention to his new role.

“I think it shows a great commitment from Broadway and from Daniel to invest in the operations and compliance side of the business… It shows they have the foresight to build those strong foundations. Because these are exciting times at Broadway, we’re a growing business and we’re doing incredibly well. We’ve got some fantastic customers on board and the future is very bright. And as we expand as a business, we need to make sure we have these controls in place to ensure we’ve not growing at a rate that’s uncontrolled, but rather in a very structured manner.”

What’s at the top of Broadway’s growth agenda?

Touching on some of those growth plans, Lloyd-John highlighted that when Broadway began its broking journey, the northwest was its principal geography. And while to some extent, it remains its primary geography, he said, its clients’ journeys have expanded that remit over time. Brokers across Europe and the USA now refer business to Broadway when they’re looking for a commercial advisor to be able to advise on the UK entities of an overseas client. 

That global inwards feature of Broadway is steadily beginning to grow, which is interesting to see, he said, and already plans are in place to decentralise Broadway into other geographies across the UK. Creating the same advisory feel across each of these new geographies is critical, he said, which is why Ward’s appointment to the operations side of the business has been so timely.

“I believe that the inside of our business is just as important as the outside,” he said. “And what Gary brings is the ability to create the infrastructure and framework that reflects the corporate governance, internal audit, risk management and compliance of the space we’re driving to get to in our next three-year plan, now that we’re coming to the end of our first three-year plan.

“Our 2024-2026 plan has corporate governance, internal audit, risk management and compliance right at the heart of it. That’s so important to us because this business is not what it was when it started. And with Gary, we feel really fortunate to have someone who’s done this journey with both smaller and larger companies.”

Regulation – to be embraced not feared

There’s sometimes a sense across the insurance market that regulator processes are to be feared, Lloyd-John said, but the team at Broadway has a different view. The business launched during COVID in 2020, and three years later it is decentralising and growing in terms of its profile, which reflects that regulation and standards of governance have been embraced along the way and represent something integral to the firm’s culture – which focuses on making sure both the client-facing and non-client-facing aspects of the business are as strong as possible.

Looking at what means going forward, Ward emphasised that the regulatory landscape is continually shifting. Keeping abreast of those changes and making sure they’re communicated effectively across the business is critical, he said, but it’s also about keeping an eye on what’s coming down the road from the FCA. Requirements do and will continue to constantly change, and success for him is about having the plans in place to implement those changes as and when they come along.

“One of the important things about this business, which differentiates it from others, is that we’re not just winning business on premiums alone,” he said. “People are transferring their policies into us, which speaks volumes about the trust our customers have in us, which is great. And that’s what I think sets us apart from some other insurance brokers quite significantly.

“[Maintaining that] is about keeping on top of everything. For instance, I set myself a target of making sure I read something from the FCA every day, just to keep on top of it. Because, it’s like everything else in this industry, if you’re not continually learning, you’re going backwards.”

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