Marsh & McLennan Companies (MMC) concluded its Young Professionals’ Global Forum 2015 with a star-studded evening party at Old Billingsgate in London last night.
F W de Klerk, the former South African President, who partnered with Nelson Mandela to end Apartheid, addressed attendees about the challenges of leadership, and working alongside Nelson Mandela to transform South Africa into a free democracy.
“It was my great privilege to walk with him on the last few difficult miles to a new South Africa,” said de Klerk (pictured, top), whose transitional leadership managed to avoid civil war, end years of racial segregation, and foster democracy in South Africa by 1994.
“As I said at that time the journey is never complete. As we contemplate the difficult road ahead of us it would be wonderful if we could find another Mandela to help to lead us towards our destination,” he added.
That presentation was juxtaposed by rock band the Kaiser Chiefs (pictured, middle), playing for an audience packed with over 1,000 attendees, including 800 of the best young talent of London’s insurance and reinsurance market.
A charity auction, held for the Teenage Cancer Trust, with the Antiques Roadshow’s Charlie Ross as its energetic auctioneer (pictured, bottom), raised tens of thousands of pounds for the UK charity.
There was also a recorded message from Prince Charles, the Prince of Wales, who commended Vicky Carter, chairman of the Young Professionals’ initiative and vice chairman for international operations at MMC’s reinsurance broking arm Guy Carpenter, for the initiative’s charitable works.
The black tie gala event concluded the Young Professionals’ Global Forum 2015 event run by MMC, which included presentations on pandemic, bio terrorism and cyber and weather risks, as well as emerging markets, product innovation, leadership and resilience.
“Inspiring young leaders to develop their skills and talents and pursue their goals with dedication and passion are hallmarks of Marsh & McLennan’s culture. We are enormously proud of the platform our Young Professionals’ Forum offers participants to learn more about the constantly changing insurance industry, its opportunities and challenges, and how their leadership can make a difference,” said MMC’s president and CEO Dan Glaser.
The two-day event included speakers such as Tom Ridge, the first ever US secretary for Homeland Security; XL Catlin Group’s CEO Mike McGavick and deputy executive chairman Stephen Catlin; and MMC’s Glaser and its chairman Lord Lang.
Ridge, who is CEO of Ridge Global, chairman of Ridge Insurance Solutions and the 43rd Governor of Pennsylvania, spoke about modern and emerging threats such as terrorism and cyber attacks.
"The cyber warrior camouflages their identity, and operates in a vast, open and unsecure space. They employ reconnaissance capabilities which are varied and very effective as they probe for weaknesses – often using low tech as well as hi-tech weapons to achieve their ends," he warned.
"There are only two types of organisation – those who have been hacked and know about it and those who have been hacked and don’t know about it. The barbarians are no longer at the gate, they are inside the network and they are concealed. This is the permanent reality of the digital universe," said Ridge.
McGavick had some tough words about what he sees as the re/insurance industry’s declining relevance. “We simply can’t do business in the old way and expect to remain relevant,” he warned.
“The world is changing faster and faster. This rate of change is a huge issue for our industry because the simple fact is that as a market we always like to know about something before we are willing to insure it. As a result, we are not a particularly innovative industry,” said McGavick.
“In 2002, the percentage of total economic activity represented by the property/casualty sector industry was 3.4%. By 2011, that figure was 2.8%. That is by definition a declining relevance. If we take cyber, as an industry we are current grappling with the issue of cyber liability. Yet the difference that we are making to the ability of society to achieve resilience is tiny relative to the exposures that it faces. We are falling behind,” he argued.
“As an industry, we need to make the trend our friend – we need to be where that trend is moving and where that movement is sustainable. So what are the five trends affecting our industry. Number one – globalisation; number two - analytics, number three – consolidation of the broker; number four – alternative capital; and number five – regulation,” said McGavick.
He offered some industry responses and consequences to the rate of change and technology.
“The first is the increased consolidation that we are seeing in the market. And the second is that it is going to focus much greater attention on talent,” suggested McGavick.
“This talent will encompass two particular capabilities that today are in short supply – one is much deeper technical sophistication both in terms of IT and analytics; and the other is a talent for innovation and the ability to challenge the norm and look at how we can do things differently,” he added.
On the challenges of growing an insurance company, Catlin said: “Growing a successful business requires three things: the first is vision; from vision you develop strategy; and from strategy then you have to execute. The vision is easy, strategy is more difficult and the execution is by far the hardest bit to do – it requires planning, determination and courage.”
Catlin also talked about starting a business in the re/insurance market.
“Looking back I must have been barking mad. When we started Catlin, our corporate assets were some pink Lloyd’s blotting paper and an inkwell given to me by my old boss. We didn’t have a photocopier or a fax machine for two years,” said Catlin. “I had no idea what the pressure of setting up an underwriting company would be, but I just did it. It is frightening and requires courage, conviction and determination.
“In 2001 we wrote $430m in premiums and employed less than 100 people, but by 2005 we were writing $1.7bn. How? We got capital when others were struggling to get capital, and the market was changing overnight. 9/11 was a huge event, but the casualty model had already begun to change. We tripled our top line and quadrupled our bottom line in the space of 2.5 years. When you see an opportunity, don’t think about it – just take it. But make sure you execute your strategy well,” he continued.
Catlin also offered a candid insight into the firm’s first troubled attempts at global expansion. “We had to start all over again because we got it wrong. It had nothing to do with the vision or strategy, but our execution was poor. We chose the wrong people. We didn’t have people who shared our values. That was a big lesson to me,” he added.
By David Benyon - firstname.lastname@example.org