Tackling the status quo fearlessly

08-09-2018

Tackling the status quo fearlessly

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Diversity is a big issue in Bermuda at the moment. Brian Duperreault did much to highlight the issue when at Hamilton but Jonathan Reiss, the company’s CFO, has picked up that mantle and is looking to make a difference—both in his own firm and industry-wide. Bermuda:Re+ILS reports.

When it comes to diversity in the industry, Hamilton Insurance Group has led from the front when it comes to its executives being unafraid to tackle the issue head-on. Back in 2014, Brian Duperreault gave a much-publicised barnstorming speech in which he asked: “where are all the women?”.

Since then, Hamilton has found several including Pina Albo, a former Munich Re executive who took the reins from Duperreault when he left for AIG this year; and Kathleen Reardon, chief executive of Hamilton Re.

Now Jonathan Reiss, chief financial officer, Hamilton Insurance Group, has picked up the mantle on this issue—in spectacular fashion at the annual Bermuda Captive Conference where he received great praise for a keynote speech in which he highlighted the importance of the issue of diversity, and what his company is doing about it.

Creating an authentically inclusive corporate culture is not always easy—but companies that achieve this and embrace a more diverse workforce will benefit, Reiss told delegates at the conference, which took place at the Fairmont Southampton Hotel in Bermuda.

“Companies that have captives have better risk management, they are better managed companies and perform better as a result,” he said. “Equally, organisations that embrace diversity and inclusion are better managed and they too get better results as a consequence of that.”

After the speech Reiss said he was continuing a legacy of which he was proud.

“Brian and Pina have always championed this idea and, in many ways, because of them, this company has punched above its weight in terms of the respect it has and the momentum it can give this,” he said. “I am proud to take that forward.”

Leading from the front

Reiss explained in his speech how he is the lead for Hamilton’s diversity and inclusion (D&I) strategy which is now being formalised and includes input from staff at all levels. He described how he felt it is important for a senior person to lead efforts on this front and also how the issue is one he is passionate about.

“Hamilton has always championed this issue. We put a stake in the ground on this since our formation and that has been backed up by many things including Brian’s speech in 2014.

“We have always been vocal on diversity and all forms of inclusion. I feel strongly about this issue and making positive change. But I also know this will help the bottom line. It is hard to implement an effective strategy on this but that is also why we must all do more.”

Reiss, the son of Fred Reiss, who is credited with first establishing Bermuda’s captive insurance sector, described how his family, from a working-class background, suffered from prejudice and when they first moved to Bermuda.

“The business community here was dominated by a local white minority and racism was prevalent. There were exceptions, but it felt like a protectionist boys’ club. And bear in mind my dad was a white male—imagine how difficult it would have been for a woman or person of colour,” he said.

He described how his father’s success in the captives space created the platform for further insurance growth on the Island with many world-class individuals launching new businesses and sectors in Bermuda. When Reiss started his career he found, given his father’s legacy, doors were opened to him and he was promoted quickly. But he said he was aware he was benefiting from advantages because of his connections, education and because he was white.

“Unfortunately, the shameful legacy of the past remains unresolved today,” he said. “The issues are not unique to Bermuda but I worry about my children’s future and the unfairness they will be exposed to. There needs to be more urgency addressing unfairness and creating an environment that is more diverse and inclusive,” he said.

One step forward

Reiss said that the majority of companies—in the risk transfer world and beyond—have a lot of work still to do. He said a 2012 description of the average C-suite of a US corporate as “male, pale and stale” remains accurate for too many companies.

“Women remain a distinct minority and persons of colour are almost non-existent. That is true in Bermuda, America and Lloyd’s despite may efforts in recent years.”

He cited statistics that illustrate this. The number of women leading Fortune 500 companies actually fell by 25 percent last year. He noted the clock in Davos, Switzerland, that counts down to the world achieving gender parity, which now suggests it will take 217 years.

“Not only does it appear that we are not making progress, we seem to be going backwards,” he said. But he stressed the drivers should be there—because it is the right thing to do and for business reasons. He noted a report by McKinsey that illustrates a statistical correlation between a more diverse leadership team and a company’s performance.

He said that while the pace of change has been “glacial” he acknowledged that there are many reasons for this and it is not an easy problem to tackle. “It is a devilishly complex issue—it is not a tick the box issue. It is a long and winding road,” he said.

Reiss likened the problem to an iceberg where the obvious issues, which might include outright discrimination and bias, represent only the top 10 percent of the problem. There are many complex issues below this including economic disparity, access to education, sexual orientation, unseen disabilities and unconscious bias—these represent 90 percent of the challenge, in his opinion.

“Progress has been made but we need to do more to make the insurance and captive insurance industries more accessible. At Hamilton, we have a saying that we want employees to bring their whole selves to work—and not to worry that differences will affect how they are treated and the opportunities they will get,” Reiss said. “But we appreciate that some of the challenges are deep rooted and not easily solved.”

Much of the rhetoric around this issue often revolves around companies doing the right thing; that they must take their role in society seriously and make a difference to making the world a better and fairer place where they can.

While this is admirable, it can also be somewhat problematic in this day and age. All companies are increasingly dependent on millennials—as customers and employees—who think and act differently from previous generations. They are more attuned to some of these issues and want to be associated with companies that also are.

“The millennials are very tech-savvy and they are the largest consumer group going forward. They will have the ability to effect change. They are not so patient, and they are also care about the greater good. They want their company to contribute to society,” Reiss said.

“That fits well with us; a lot of employees of all ages have come up to me and said how pleased they were with my speech. It is important that inclusion means many things. It also means giving young people a chance.

“Here, we want young people challenging the leaders; we want them to ask questions. We want to be appealing to the best talent. We want new ideas, not monoline thinking.”

No barrier too high

No matter how big the hurdles, Reiss stressed that there are reasons to be positive. He said most companies are much better informed and have better data representing their diversity and inclusion. There is a better understanding of what this means and where they want to get to.

He stressed that it is not always easy. Many people have deep-rooted and unconscious biases that can be hard to overcome. He had something of a lightbulb moment when he completed unconscious bias training while with EY.

“That helped me understand what this was all about much better,” he said.

He does not necessarily advocate anything that means ticking boxes—including any form of quotas for the representation of people in companies or on boards.

“I would not dismiss the idea but it can have unintended consequences. It can then undermine the process and the achievements of people who have earned that position,” he said. “It is better to create a culture in which fairness and equality always prevails.”

But companies can prevail if they simply tackle one issue at a time and play the long game, he believes.

“It is tough—especially when you are dealing with historical legacies and unconscious bias—but there are actions companies can take,” he said.

He recommended that companies understand that they cannot tackle the whole issue in one go and instead deal with it in steps. They should start by gathering data and, once they understand the picture, set goals and implement specific initiatives around things such as training and recruitment designed to tackle the problem.

He also recommended learning from others who have done this before. “Take advantage of the knowledge of others; don’t try and reinvent the wheel,” he said

“It is not easy. It takes careful planning and a long time to change behaviours and it requires diligence. It is a marathon, not a sprint, on a long and winding road.

“But I also believe we are at an inflection point and attitudes are changing quickly. Organisations must be fearless in tackling the status quo for we hold the hopes and dreams of those we hire—and that is what we all need: hope,” he concluded.

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