At our most recent Insurance NED roundtable, we discussed top prio rities for firms over 2021. Unsurprisingly, operational resilience, staff wellbeing and maintaining cultural stability ranked amongst the top 5. In particular, it was clear that transitioning to more flexible working practices would be a key area of focus, and a difficult one to get right.

Top priorities for firms over the next year

NEDs: working through the pandemic

We asked NEDs whether certain priorities were put on the back-burner over 2020 due to COVID-19.  A number of NEDs commented that their firms still managed to work effectively on most or all of their top priorities over the past year.

In most cases, board meetings are taking place more frequently than usual, albeit for shorter durations. One NED commented that there has been an assumption over the last year that NEDs are far more available than pre-COVID.

Some NEDs have found virtual meetings more efficient. NEDs were also feeling good about the positive environmental impact of virtual meetings.

‘Every single one of the boards I sit on has had more meetings this year than in previous years. Not because we have more to discuss, just because we don't have to travel.’

How are staff faring with virtual working?

The picture was less positive when NEDs discussed their firms’ employees. Mental health is the key concern, especially with people having found the third lockdown much harder to deal with than the previous ones. Outward appearance isn’t always indicative of how well someone is doing mentally so this is a difficult issue to manage. Also, while there is a lot of concern about mental health, there is often a lack of skills across the business to deal with it effectively.

Staff development was another big concern – many NEDs agreed that online courses are just not the same as the learning that people get from informal discussions and pair-working with colleagues.  We know from our own experience that actuaries benefit so much from casual conversations with underwriters and claims handlers, and this does not happen as naturally in the virtual working environment. Some NEDs also worried that innovation and creativity was down because those informal ‘water cooler’ moments do not happen anymore.

While working from home has resulted in major cost savings to employees and the business, NEDs are very aware of people’s struggles. A number of NEDs commented that people want to go back to the office more now than they did 6 months ago. Finally, there is concern that, the longer we live in a virtual world, the more the firm’s culture may be eroded.

There was unanimous agreement that we will be returning to a more flexible world than before, but with question marks over how this will work successfully in practice.

What concerns do NEDs think firms need to overcome for hybrid working to work successfully?

• Building junior talent – it is obvious that new joiners learn a lot by looking over colleagues’ shoulders. Asking those silly questions is much easier in person than over a call. This is particularly true of underwriting and claims roles which are very technical and where there has traditionally been a strong “apprenticeship” model for learning. I think this can be made to work in practice, but it will take planning to ensure that teams can spend regular time in the office together, while still giving people individual flexibility.
• For large teams, managing meetings in a hybrid world is likely to be a more significant issue. How do we ensure that virtual attendees in meetings are not disadvantaged? One solution is to have a more active chair at meetings who ensures all attendees have had a chance to contribute. 
• Retaining the firm’s culture – firms are worried about maintaining that sense of togetherness; especially smaller firms that did not have much of a flexible working policy pre-COVID-19. Firms will have to work very hard to maintain their culture and be innovative in embedding new joiners into the firm’s culture. This will involve a significant ongoing investment of management time but will be essential to ensure ongoing success in the new environment.

These are just some of the challenges that we discussed. There is clearly a lot to consider and firms are looking to each other for ideas and examples of best practice. 

As daunting as it seems, we did go from being in the office almost all the time, to working virtually (and effectively) overnight. I am positive that the ‘new normal’ will work out over time through trial and error.

Please get in touch with me if you would like to join our next Insurance NED roundtable.