Asia InsuranceThe Next Generation CEO

Executive summary

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Market challenges

The Asia Insurance CEO

Drivers of outperformance

Gaps, challenges and considerations

Contents

Getting the right leadership in strategic Asian markets is critical to both global insurance MNCs as well as key domestic players.

Need

The Asia insurance market is facing unprecedented levels of change – where businesses are having to balance high growth and modernization with a continued focus on controls, risk mitigation and operational efficiencies – all across a highly fragmented set of markets. Many insurers are exploring and embracing agile learning methodologies in order to get ahead.

Context

This presents a set of challenges that requires a new blend of often contradictory skillsets for the leaders who are responsible for navigating these pressures.

Challenge

Russell Reynolds Associates conducted a deep dive analysis of the backgrounds of 30+ insurance CEOs across the region. In addition we asked 12 of these executives to undertake our Leadership Span assessment. We benchmarked the outcomes against our Hogan dataset of over 5 million records. The results give a comprehensive evaluation of the current generation of insurance leaders in Asia.

Response

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Asia – not for the faint hearted

Despite the rosy macroeconomic outlook, local and multi-national insurers face a multitude of complex social, political, technological and financial challenges in Asia:

Are the current generation of insurance leaders equipped to deal with these issues?

The pressures of doing business in Asia have resulted in a unique challenge for MNCs and local companies. What type of leader do these organisations require in order to be successful?

In response, Russell Reynolds has evaluated the backgrounds, experience levels and competencies of insurance CEOs across the region.

Modernising routes to market

Traditional distribution models are often inefficient in emerging markets. Whilst the agency channel is still dominant, many insurers are focussing on an omni-channel approach, heavily reliant on partnerships and eco-systems.

Market liberalization

In developing Asia, while some regulators (e.g., China) are liberalizing the market to foreign competition, others (e.g. Malaysia) are implementing caps on foreign ownership to encourage local ownership and protect local insurers.

Evolving regulatory landscape

The regulatory landscape differs considerably from country to country and companies have to invest considerable sums in risk and regulatory

functions in order to ensure compliance with local requirements.

New technologies

Through advances in insurtech and mainstream adoption of new technologies, which will make

insurance policies more affordable and accessible and risks more easily mitigated, it is estimated

that total cost savings for Asia’s insurance industry could be around USD 300bn per year by 2025.

People are mesmerised by the growth and the gloss of Asia. With the growth numbers and the population growth, it's very easy to get over excited and dazzled by the big numbers and the sheer volume. But the first thing you need to do is understand the markets… and that requires a visionary kind of foresight.

– Roy Gori, Group CEO of Manulife1

1 Uribe, Alice and Joyce Moullakis, “Manulife's new president Roy Gori says understanding Asia is key” Financial Review, April 2, 2017.

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Asia insurance CEOs

In order to understand more about the career history of insurance CEOs, Russell Reynolds analyzed the backgrounds of over 30 Asia based CEOs working in both the life and general insurance segments of the industry. We also compared the differences between CEOs working in multi-national companies (MNCs) versus those in local or domestic insurers.

Technical gurus

The majority of Asia CEOs have held roles in finance, risk management or underwriting, with a profound depth of technical knowledge – key to building credibility with HQ and regulators.

Technical/functional specialists with local knowledge

CEOs at both MNCs and regional insurers have a depth of experience around core insurance technical skills and understand local markets.

Asian insurers versus MNC insurers

Asia CEOs in locally headquartered insurers are more likely to have held roles across operations, strategy and investments while CEOs at European and North American headquartered insurers tend to have had general management roles.

MNCs lack a sustainable talent pipeline

Over recent years, global insurance companies have been sending high performing leaders to Asia Pacific to secure growth opportunities across the region. However, there continues to be significantly higher levels of turnover at globally rather than regionally headquartered insurers.

of Regional CEOs were appointed since 2015

of Regional CEOs are expatriates

Externally appointed

of Group CEOs were appointed since 2015

of Group CEOs share a different nationality than

the HQ of the insurer

Externally appointed

Local market savvy

Asia CEOs have a deep experience in the region in order to respond to market dynamics, drive change and build trust with regulators. As such, almost all Asia insurance CEOs have developed their careers in Asia.

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General Management

Finance, Risk or Underwriting

Strategy

Distribution

Operations

Marketing

Investments

87%

50%

80%

80%33%

39%

28%

61%

22%

40%

28%

80%

0%

7%

33%

13%

7%

22%

11%

22%

Asian Insurers CEOs

Asian Insurers

MNC Insurers

MNC Insurers CEOs

Year of appointment SourceEthnic Diversity

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Leadership Span™ ™ is our research-based assessment methodology developed by Russell Reynolds Associates and Hogan Assessment. This is the market leading platform for predicting C-suite performance and durability. Research indicates that the best executives are able to flex and integrate across behaviors that seemingly compete with one another. Executives the demonstrate Span have longer tenure in C-suite roles and more agility – while low Span executives are more likely to derail. Below are the factors that predict a CEO’s ability to Span.

To assess how insurance CEOs in Asia are meeting these unique challenges, Russell Reynolds Associates combined benchmarking data from its Hogan dataset of 5.5 million people, our C-suite Leadership Span™ psychometric assessments and interviews with 12 high-performing Asia insurance CEOs.

Leaders display perseverance and grit in the face of challenges and know their own strengths, yet also are aware of their limitations.

Leaders challenge the status quo and make the case for fundamental changes, yet also act as an organizational filter to ensure these bold ideas can be implemented and deliver results.

Leaders inspire trust through influence, charisma and drive, yet also let others take the spotlight and empower others to create powerful networks within and beyond the organization.

Leaders thrive in ambiguity and adapt nimbly, yet also exercise caution in taking risks and foresee threats on the horizon.

C-SuiteDifferentiators

CoreLeadership

PRAGMATIC

DISRUPTIVE

SETTINGSTRATEGY

EXECUTINGFOR RESULTS

LEADINGTEAMS

RELATIONSHIPSAND INFLUENCE

RELUCTANT

RISK TAKING

VULNERABLE

HEROIC

CONNECTING

GALVANIZING

DISRUPTIVE PRAGMATIC

RISK TAKING

Leadership Span Framework

RELUCTANT

HEROIC VULNERABLE

GALVANIZING CONNECTING

RRA's Leadership Span

Our methodology

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Asia Insurance CEO s outperform global benchmarks

Asia insurance CEOs consistently outperformed other executives in their Leadership Span™ capability assessments.

Through our psychometric assessments we identified that insurance CEOs in Asia demonstrated an extraordinary breadth of capabilities compared to peers in other industries across the globe.

This has been driven by an increasingly mature local talent pool, complemented by an influx of high-calibre leaders seeking to secure share in high-potential, strategically significant Asia markets.

These individuals are uniquely required to outperform within a highly challenging and fast paced business environment – and increasingly represent best-in-class leadership among Financial Services CEOs globally.

Asian insurance CEOs scored above their global peers in 7 out of 8 of our C-Suite differentiators and ability to Span. Well above their Western counterparts.

Compared to other CEOs, Asia insurance CEOs are…

Compared to other banking CEOs, Asia insurance CEOs are…

Strongest differentiators of Asia insurance CEOs

Leadership Span™ scores versus CEO global benchmarks

Asia insurance CEOs outperform global benchmarks

Galvanizing

18%Difference

Connecting

11%Difference

Heroic

12%Difference

Risk Taking

10%Difference

72% 70%54% 59%

70%58%

70%60%

DemocraticInnovative

Detail- oriented

Structured

IntuitiveAltruisticOutgoing

Calm Modest

Core Competencies

IntuitiveOutgoing

Sensitive to others’ needs

DemocraticData-oriented

Trusting Comfortable with change

Disruptive67 34Pragmatic

Risk Taking Reluctant

Heroic Vulnerable

Galvanizing Connecting

70 47

72 59

72 70CEO Benchmark

Insurance Executives

Lower on ... Lower on ...

Higher on ... Higher on ...

Senior Executive Average

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What are the key differentiators?

Stand-out characteristics of insurance CEOs in Asia

Demonstrate bold leadership to create continued forward momentum for the organization when facing ambiguity

Driven to maintain high standards regardless of the pressure they and the organization are under

Remain single-minded about pursuing opportunities, stay the course and are willing to go against the grain to drive strong results

We see three characteristics that stand out as compared to our global CEO benchmarks: the ability to execute through uncertainty, capacity to act as connectors and the tendency to exude optimism.

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They engage purposefully with those around them and create an inclusive culture

They make sure to take others along on their decisions, seek to understand others’ concerns and tell a compelling story to persuade and create shared purpose and value

Demonstrate the ability to proactively connect with customers and anticipate their needs

Demonstrate grit, mental toughness and perseverance in approaching challenges

Exude poise and optimism during uncertain times to reassure stakeholders

They channel and cascade this positive disposition down to the organization, inspiring collective resilience to navigate through turbulent times

Execute through uncertainty

Connectors

Exude optimism

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Asia Insurance CEO s outperform global benchmarksGaps, challenges and considerations

There are two critical issues to be aware of:

Which raises two important questions:

Internal leadership pipelines are weak

How do you identify and then develop future insurance leaders coming through an organisation?

There is a big gap between the Asia insurance CEO and their team’s capability

Are the insurance leaders of today appropriate for what’s required in Asia tomorrow?

For further discussion, please feel free to contact:

David CooksonAsia Insurance LeaderE: david.cookson@russellreynolds.comT: +65 9829 5387Singapore

Ric RoiLeadership & Succession Practice Leader E: ric.roi@russellreynolds.comT: +65 6496 0633Singapore

Ashley WallaceAsia Insurance LeaderE: ashley.wallace@russellreynolds.comT: +852 2844 0818Hong Kong

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Russell Reynolds Associates is a global search and leadership advisory firm. Our 425+ consultants in 46 offices work with public, private and nonprofit organizations across all industries and regions. We help our clients build teams of transformational leaders who can meet today’s challenges and anticipate the digital, economic and political trends that are reshaping the global business environment. From helping boards with their structure, culture and effectiveness to identifying, assessing and defining the best leadership for organizations – our teams bring their decades of expertise to help clients solve their most complex leadership issues.

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