corporate social reponsibility report 2020
TRANSCRIPT
Ayalon Group Insurance and Finance Corporate Social Responsibility Report 2020
Ayalon Group Insurance and Finance
Corporate Social Responsibility Report 2020
TABLE OF CONTENTS
COMPANY PROFILE ................................................................................................................................................................... 6 ABOUT AYALON........................................................................................................................................................................ 6 CORPORATE RESPONSIBILITY IN THE AYALON GROUP ................................................................................................... 16
PEOPLE SERVING PEOPLE - SERVING ISRAELI SOCIETY.................................................................................................20 INCREASING SOCIAL RESILIENCE ....................................................................................................................................... 21 INVESTING IN THE ISRAELI ECONOMY................................................................................................................................ 32 PROTECTING THE ENVIRONMENT ....................................................................................................................................... 35
PEOPLE SERVING PEOPLE - OUR SERVICE.........................................................................................................................40 QUALITY AND HUMANE SERVICE ........................................................................................................................................ 41 AT THE SERVICE OF INSURANCE AGENTS.......................................................................................................................... 47 FAIRNESS IN SERVICE ........................................................................................................................................................... 49 INNOVATION............................................................................................................................................................................ 51 ETHICS AND PRINCIPLED MANAGEMENT........................................................................................................................... 54 PRIVACY AND INFORMATION SECURITY............................................................................................................................. 56
PEOPLE SERVING PEOPLE - AT THE SERVICE OF OUR EMPLOYEES .............................................................................58 OUR PEOPLE .......................................................................................................................................................................... 59 A CULTURE OF OPENNESS AND PARTNERSHIP................................................................................................................. 62 EMPLOYEE TRAINING AND DEVELOPMENT........................................................................................................................ 64 WORK ENVIRONMENT AND TERMS OF EMPLOYMENT...................................................................................................... 66 ABOUT THIS REPORT ............................................................................................................................................................ 70 APPENDICES........................................................................................................................................................................... 73
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Dear Stakeholders,
We are proud to publish the first corporate responsibility report of the Ayalon group, the leading insurance group in Israel. The report details the variety of actions and processes of the company for the sake of promoting social and environmental values in Israel, both as part of the business activity and as part of the corporate governance and professional ethics.
We believe that the country’s business companies play a valuable role in leading social activity, in protecting the environment and in setting high standards for societal resilience. In recent years, we have been working through various channels in order to instill these values in the organization.
The Ayalon group’s commitment to social responsibility values is reflected in a long line of initiatives, such as encouraging the volunteering of employees to supporting people with disabilities and at-risk youth, assimilating green work processes and work procedures to reduce the environmental impact of the group; and taking environmental aspects into account when selecting investment targets.
The past year was largely focused on the coronavirus pandemic crisis1 in Israel and throughout the world. We at Ayalon are especially proud of the way in which we mobilized to assist our customers and our agents, and just as important – the company employees – by introducing a series of benefits and advanced digital tools consistent with the special circumstances. This does not involve only the business aspect. Even at the height of the pandemic, we made sure not to abandon our activity for the resilience of Israeli society; we continued to maintain a warm
relationship with Holocaust survivors, to support a variety of associations and organizations and we also led the raising of millions of Shekels for the ‘Shalva’ organization and for children with disabilities on the organization’s annual fundraising day, when hundreds of Ayalon employees volunteered.
It is important to emphasize that alongside our many pointed actions for the welfare of Israeli society, we make sure to promote the social and corporate responsibility value – a fundamental value ingrained in the Group’s DNA – in all our organizational and business activities and steps and among the stakeholders in the company. We believe that through this holistic approach we can create real change both at the group level and at the level of the public that we serve.
Although we have done much so far, there is no doubt that we are just getting started. Ayalon will continue to promote activities and values for the benefit of the Company’s customers, partners, suppliers, employees and Israeli society as a whole – and we must all do our part and take action in this regard also for the sake of future generations.
Arik Yogev, CEO Sharon Reich, CEO Ayalon Insurance Company Ayalon Holdings,
Deputy CEO, Ayalon Insurance Company
The definitions of the coronavirus pandemic and the coronavirus crisis in this report refers to the period between the outbreak of the pandemic to the end of 2020.
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1
COMPANY PROFILE ABOUT AYALON2
‘Ayalon Holdings’ is one of the leading insurance and savings groups in Israel. Most of the group’s business operations are concentrated in the subsidiary ‘Ayalon Insurance Company’. Apart from said company, the group’s members include insurance agencies specializing in a variety of fields and companies with various extents of holding. Ayalon Insurance Company provides a range of services in the various insurance sectors, such as general insurance, health insurance, business insurances, as well as in the fields of investment and long term savings. The company leads a clear line of humanistic and value driven management designed to create long term sustainable value for all its stakeholders.
The company is constantly working to innovate and to improve, as well as to customize the basket of products and services that it offers to its policyholders. Most of the group’s services are marketed by the insurance agents, its key business partners, perceiving the insurance agent’s added value to the policyholder being known to the policyholder, seeing his personal interest and helping him professionally in the moment of truth. Moreover, the group creates added value for the group’s stakeholders through its holdings in diverse business companies.
2 The report is written in the masculine solely for reasons of convenience, but it refers to both genders and anything stated in the masculine also means the feminine.
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Wherever a holding rate is not specified, the holding rate is 100% * Holdings percentage at 2020
GROUP STRUCTURE
The group has holdings in a number of subsidiaries, including the ‘Ayalon Neemanim’ Insurance Agency and the ‘Hachi Bari’ Insurance Agency. The Group is a partner in the ‘Alon Ashkenazi and Gil Vardi’ Insurance Agency (25%), in ‘Hitech Insurance Agency’ (40%), in the Beit Harofim TLV Medical Center (*about 40%), etc. In addition, the Ayalon Insurance Company holds the company ‘Ayalon Insurance Issuing and Capital Raising Ltd.’, which issued two series of debentures to the public worth a total of NIS 215 million.
Ayalon is a member of the Israel Insurance Association and in the Association of Life Insurance Companies in Israel. As a member of these organizations, it has representation before the Commission of Insurance and the state authorities, including the government ministries, the Knesset, public authorit ies and public institutions.
The Ayalon Holdings group is a public company whose shares are traded on the Tel Aviv Stock Exchange. As of the end of 2020, 67.26% of the share capital was held by the estate of Mr. Levi Yitzhak Rachmani, the company’s founder. The remainder of the shares were held by the public. The group’s administrative offices are located in the Ayalon House, at 12 Abba Hillel Silver Street, Ramat Gan.
Ayalon Blue Leasing Ltd.
Ayalon Insurance Issuingand Capital Raising Ltd.
Ayalon NeemanimInsurance Agency ltd.
Ayalon Long-TermSavings Ltd.
Meitav Dash Provident Funds and Pension Ltd.
Hitech Insurance Agency Ltd.
TLV Medical Center Ltd.
AYALON HOLDINGS LTD.
Ayalon H.L.V. Assets and Investments Ltd.
M. Iran Construction and Holdings 2001 Ltd.
Alon Ashkenazi Insurance Agency (2011) Ltd.
Gil Vardi Insurance Agency Ltd.
Ziso Construction and Development Ltd.
Ayalon InsuranceCompany Ltd.
About 20%
About 40%
50%
50%
25%
80%
About 10%
About 10%
Eyal Zvi Ltd.
Keva Insurance Agency Ltd.
Nechonim Insurance Agency Ltd.
AyalonMedical Risks Management
Ltd.
A.H.Y. AyalonChesed Yibane (P.B.C.) Ltd.
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ORGANIZATIONAL STRUCTURE – AYALON INSURANCE COMPANY LTD.
Internal Auditor
Chief Risks Manager
Legal Counsel and Company Secretary
Auditing and Regulation Department
Business Development and Subsidiaries
Ayalon Insurance Company CEO Chairman of the Board of Directors
SubsidiaryAgency
Serving Providing Departments Business Departments Sales Division
AyalonNeemanim
Finance Department
Headquarters,Innovation and Human Resources Department
Actuary Department
Information SystemsDepartment
OperationsDepartment
Marketing andCommunication Department
Investments Department
General Business
Insurance Department
General Individual
Insurance Department
Insurance PaymentsDepartment
Long-Term Savings
Department
Health Department
Tel Aviv District
Central District
Haifa and Northern Israel District
Jerusalem District
Ayalon Insurance Company consists of thirteen departments, including five business departments that handle development and operations in the various insurance fields, seven departments engaged in providing internal service and the Sales Division that manages the Company’s district system and maintains contact with the agents. Apart from these, there are additional headquarter units.
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AYALON GROUP IN NUMBERS
3 fields of activity
general insurance, health insurance,long-term savings
4 districts
Tel Aviv, Central, Haifa and Northern Israel, Jerusalem
4 key core values
humanity, service orientation, fairness, innovation
2,600insurance agents are our partners
1,137 employees, 71.77% of whom are women
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60.3% of the Group’s executive management are women
66% of the Company’s vehicles are hybridvehicles
Approximately 50% of our managed assets are invested in the Israeli capital market
NIS 827 million
were invested in projects andcompanies with added social and environmental value
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HONOR AND AWARDS
Access Israel The Valuable 500 Maala Rating Superbrands Human Resources Israel (R.A.)
Chamber of Insurance Agents in Israel
Ayalon was awarded the 'Accessible Organization' Badge of Honor by 'Access Israel' in 2018 and in 2021.
In 2020 Ayalon joined the initiative “The Valuable 500”, which includes 500 companies from all around the world who commit to inspire change in the field of accessibility, and promote equal rights and employment opportunities for people with disabilities.
In 2021, Ayalon joined the ‘Maala Rating’, which rates Israeli companies according to their performances in the field of corporate responsibility and it was awarded a gold rating (based on 2020 performances).
In 2019 and in 2021 Ayalon Insurance Company was crowned a superbrand in Israel. The selection shows appreciation by the Israeli consumers and their recognition of the strength of the brand.
Ayalon was awarded first place in the Excellence and Innovation Competition of the Human Resources Israel Community for 2020, in the category of leading cross-organizational change processes.
According to a survey of the Chamber of Insurance Agents in Israel, Ayalon was ranked in the long-term savings service survey in first place three times in a row, as of 2019 onward.
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The leading activity fields of Ayalon Insurance Company are:
General insurance This field comprises insurance policies that cover damages caused to property or person at the individual or business level, including property insurance, liability insurances, marine and third party liability insurance. General insurance includes, inter alia, the sectors of car insurance, apartment insurances, business insurances, etc.
Health insurances This field comprises long-term or set time period health insurances, policies that provide coverage for medical-insurance events resulting from risk factors such as diseases, accidents, surgeries, transplants and medications outside the basket of medications and other medical events. The policies allow funding of the necessary medical treatment by a number of means reimbursement, one-time grant, etc.
Long-term savings This field comprises life insurances and savings policies. Within the framework of life insurances, we provide our customers with coverage for insurance events in their lives, including death, disability and loss of working capacity. Within the framework of the savings policies, we offer our customers insurance plans that allow savings-based financial accumulation, as well as investment for various time ranges and needs, including receiving pension for the rest of their lives (long life).
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MILESTONES IN THE EVOLUTION OF AYALON
Investment in the Insurtech Selling of NZI’s holdings in the Company to the Rachmani family; the listing of the company for trade on the Tel Aviv Stock Exchange
Merger of ‘Ayalon Pension and Provident Funds’ with ‘Meitav Dash Provident Funds and Pension’
Venture Capital Fund FinTLV; investment in the first digital product, Ayalon Living; purchasing of the Beit Harofim TLV Medical Center (About 40%)
Publication of the company’s first corporate responsibility report
1976 1987 1995 2017 2018 2019 20212020
Founding of the Ayalon Ayalon Insurance Company by becomes a the late Mr. Levi Yitzhak public company Rachmani, in partnership with the New Zealand insurance company NZI
Selling of ‘Ayalon Investment House’; raising of debentures and shares in substantial volumes; purchasing of the life insurance activity of ‘Psagot Insurance Company’; establishment of an innovation unit; implementation of a digital transformation
Creating partnerships with the Alon Ashkenazi and Gil Vardi insurance agencies (25%) and the Hitech Insurance Agency (40%)
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THE CORE VALUES OF AYALON We at Ayalon, a leading insurance company in Israel, have declared four key core values as our motto. These values guide us in our activities and in our business practices. They are our compass and in light of them we make decisions and outline the strategic path for the Company. Our values are:
Humanity
We believe that at the core of the insurance world there should be humanity and an interpersonal relationship between the policyholder and the insurer, and we feel that this kind of relationship establishes l o n g te r m t r u s t b e t we e n t h e parties. Since we are an entity that frequently meets our customers at difficult moments in their lives, we endeavor to provide a pleasant service experience by emphasizing the personal relationship. Moreover, due to the recognition of the great value of the personal relationship between the agent and the insurer, our primary distribution strategy relies on insurance agents.
Service orientation
A high level of service is a strategic goal for us, and we aim to meet this goal and invest a great deal of resources to this end. Due to the high level of service that we provide to our policyholders and to our agents we have been chosen time and again as a leading insurer. The company’s slogan People Serving People reflects the service orientation value instilled in the company and setting it apart.
Fairness
The insurance field is sometimes perceived as a complex field and we want to help our customers make informed financial decisions. Fairness and transparency have stood as ethical fundamental principles of the company since its inception and for this reason it provides supportive tools and data for decision-making and acts to increase transparency and trust.
Innovation
As a company operating in the innovative and entrepreneuria l ecosystem in Israel, we are aware of the importance of promoting innovat ion in al l business and operational fields. In our view, innovation increases our efficiency as well as our effectiveness and relevancy to all stakeholders. We promote innovation in all aspects of the company’s operations starting from the digital service channels, t h r ou g h i n nova te te c h no l o g y i n t e g r a t e d p r o d u c t s a n d t o streamlining internal work processes.
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THE STAKEHOLDERS OF AYALON The stakeholders are those that influence the Company and are influenced by its business operations. As a business organization, we want to maintain effective and long-term relationships with our stakeholders in order to attain the Company’s business and strategic goals. The corporate responsibility at Ayalon facilitates in maintaining and developing these relationships.
As a leading financial institution in Israel, we have interfaces with many and varied entities in the economy and we have long-term professional relationships with them. Our key stakeholder groups include:
Policyholders Insurance agents Employees Suppliers Investors
Reinsurers Community
and civil society
organizations
Regulatorsand state
authorities The
environment Umbrella
organizations
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CORPORATE RESPONSIBILITY IN THE AYALON GROUP As a derivative of our values and our vision, we are deeply committed to promoting social and environmental values in all aspects of our business and operating activities. Being a financial company with a humane outlook, we see our stakeholders as people with diverse needs and desires. Accordingly, we create material and sustainable value for all the stakeholders and take their needs into account when making business decisions. We believe that creating common value with the stakeholders is a key growth engine in the business environment of the 21st century. This kind of conduct strengthens trust and establishes long-term relationships, which are cornerstones in the insurance field.
Our corporate responsibility serves the stakeholders of the company, and we work to create impact and to influence three circles:
• Israeli society This is the broadest circle. Our impact is reflected in our core
business activity and touches the entire Israeli economy.
• The policyholders and agents Our business activity creates value that directly affects our customers and our key business partners.
• The company’s employees The inner circle where we create long-term value
for the benefit of all the employees.
Our corporate responsibility is managed in multiple locations: The Marketing and Communication Department at Ayalon Insurance Company leads the group’s corporate responsibility; various steps and processes are managed by the professional departments and by headquarters, depending on the relevant professional aspects; the company’s management and board of directors oversee a variety of topics associated with corporate responsibility.
The management of our corporate responsibility is carried out with a long-term view of the group’s business needs and of the stakeholders’ needs. We have chosen to set biennial goals with the understanding that the promotion of corporation responsibility is a complex lateral process that requires time for implementation. The set time frame allows the development of corporate responsibility while at the same time implementing an invested and effective management process in order to create common sustainable value for the Company and its stakeholders. The goals are now integrated and will also be integrated into the future work plans of the company’s business departments with the aim of continuing to develop and create value for all parties.
In 2021, the Ayalon group joined the Maala Rating, the leading corporate responsibility ranking in Israel for commercial companies operating and trading in Israel. In the 2021 rating, which is performed based on 2020 data, Ayalon was awarded the prestigious gold rating.
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PROMOTING THE UN SUSTAINABLE DEVELOPMENT GOALS In 2015, the UN General Assembly adopted a series of global goals for sustainable development (Sustainable Development Goals SDGs) and the world is required to attain them by 2030 in order to facilitate worldwide sustainable economic development. The goals, which were initially set as goals for countries, were quickly adopted by business entities working to help the countries of the world attain them.
The SDGs consist of seventeen goals in a variety of fields, for instance social equality, environmental protection, inclusive economic growth, promotion of inter-sectoral collaborations, etc. The goals were divided into specific targets and quantitative indicators that each country is required to examine and then report the degree of its success in attaining the same. The goals were adopted by all the UN member states, among them Israel, in order to enable effective coping with humanity’s major challenges in these years.
As part of our corporate responsibility, we are working to promote the SDGs relevant to Israel’s business activity and helping the country meet its global obligation. The SDGs that we promote in our business activity are:
Good Health
Quality Education
Gender Equality
ReducingInequality
Climate
Change
Affordable Clean Energy
Clean Water
and Sanitation
Industry,
Innovation and
Infrastructures
Respectable
Work and
Economic
Growth
Peace, Justice and
the Strength
of Institutions
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THE BOARD OF DIRECTORS’ INVOLVEMENT IN THE FIELD OF CORPORATE RESPONSIBILITY
According to the leading practices in the field of corporate governance, there is a separate board of directors for Ayalon Holdings, the public company that heads the group, a board of directors for Ayalon Insurance Company, which is held by Ayalon Holdings, and a separate board of directors for Ayalon Insurance, Issuing and Capital Raising, a reporting corporation held by Ayalon Insurance Company. The board of directors is the senior governing body at the company and each one of the boards of directors outlines the policy of the company that it heads and oversees the implementation of the policy by the companies’ managements. The activity of the board of directors is carried out though the plenum and through specialized committees, such as an audit committee, a compensation committee and a balance sheet committee (examining financial statements). For further details concerning the structures of the boards of directors and the committees, see in the annual report of each one of these companies.
Topics pertaining to corporate responsibility fields that are material to the company are discussed and overseen by the boards of directors and the committees. In 2020, numerous discussions were held in the boards of directors and in the
committees on topics related to corporate responsibility issues and you can read about them at length later in this report. These forums discussed, inter alia: Innovative insurance products with social and environmental value; procedures in the field of ethics; management and development of service quality, including an examination of service indicators; privacy and information security control; privacy and cyber policy; approval and examination of procedures from the field of ethics; a program for employing people with disabilities; and allocating resources to support third sector organizations.
The internal audit array conducts internal audits on topics that are directly and indirectly related to the fields of corporate responsibility In 2020, audits were performed, inter alia, on topics of privacy and information security, service quality, making services accessible to isolated customers, accessibility to people with disabilities, etc. The audit reports are discussed in the audit committees of the boards of directors.
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PEOPLE SERVING PEOPLE - SERVING ISRAELI SOCIETY
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INCREASING SOCIAL RESILIENCE
Israeli society faces a variety of challenges: Road accidents, social disparities, morbidity, crime, etc. Our ability to grow as a society and as individuals depends, in part, on our ability to cope with these events and to reduce the incidence of such events. We at Ayalon are working from a human view of the policyholder and are trying our best to help our customers cope with the ramifications of these challenges.
As a company for which the humanistic value is one of its central values and that insures the range of insurance sectors, our business activity focuses on insurance assistance to our customers in facing challenging events and in preventing accidents and future events. We invest a great deal of resources in preparing for the future and utilize our professional abilities in order to encourage our policyholders to maintain a safe lifestyle, for instance by providing built-in incentives in the insurance policies and tools for maintaining a safe lifestyle. In this way, we create a common sustainable business and social value for our customers, for Israeli society and for ourselves as an organization.
Our activity to create social value is extensive and touches on many varied aspects of the group’s business and operational activity, such as a high-level service, efforts to reduce the carbon footprint, implementation of our extensive donation policy, etc. We invest considerable resources in contributing to the community since we attach great importance to this endeavor and contribute in a number of spheres: Encouraging a safe driving culture, promoting health in Israeli society, and assisting economic and environmental development.
CONTRIBUTING TO THE COMMUNITY
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Contributing to the community is an intrinsic part of our social responsibility and of the value that we create for Israeli society. As a business company that works with the community in Israel and whose core business activity pertains to connecting communities,3 we have a responsibility to strengthen Israeli society and we attach great value to increasing the collaborations between communities and social organizations.
The community activity at Ayalon is conducted through two channels – social involvement of employees and financial donations to social organizations. The activity is conducted by the Marketing and Communication Department in accordance with the group’s social investment policy, in accordance with the donation grant procedures and in coordination with the company’s CEO. We defined the key spheres of activity on which we focus both based on a connection to the spheres of our business activities and in accordance with the company’s values and its aspiration to see each person for who he is. The following are our six core community spheres:
• Equal educational opportunities for youth from the socio-economic periphery
• Promoting road safety • Activity for the benefit of people with disabilities
• Support for Holocaust survivors • Promoting health in Israel • Promoting women in Israeli society and raising awareness for the
prevention of violence in general and against women in particular
3 The basic business model of an insurance company is a community model – the insurer collects premium payments from its policyholders and uses the funds that it has collected inorder to pay policyholders facing an insured event.
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Within the framework of conducting the community activity, we build an annual social program based on these core spheres. The annual program includes a donations budget, employee volunteering and various social highlight events. Furthermore, we have close relationships and long-term collaborations with select social organizations operating in each one of our core social spheres.
KEY COLLABORATIONS AND LEADING SOCIAL PROGRAMS Ayalon promotes safe driving in Israel Or Yarok Association The Or Yarok Association sets as its aim to combat road accidents and to minimize the number of casualties in accidents as much as possible. This by raising awareness among the public of the inherent dangers on the road, improving the driving culture and raising the issue on the public and national agenda. The Association is our strategic partner in social activities to promote road safety. Within the framework of the collaboration, Ayalon employees volunteered in outreach activities to prevent driving under the influence of alcohol. Also in 2020, during the coronavirus crisis, as well as in 2021, the Company’s employees went out to entertainment complexes in the evening hours for the sake of outreach activity among partygoers regarding the importance of cautious and safe driving without alcohol. Furthermore, we promoted on the radio, together with the Association, a promotional campaign for raising awareness of the issue of distracted driving and we distributed professional content articles with regard to safe and cautious driving among the company’s policyholders and employees.
Ayalon supports holocaust survivors Amcha Association The Amcha Association provides psychosocial care to Holocaust survivors and the second generation and assists them in a variety of unique activities in dealing with psychosocial difficulties. For years, we have been adopting members of the Tel Aviv Amcha Association, and over the year Ayalon employees have volunteered in a variety of joint activities with the Association, such a holiday meal events (Rosh Hashana, Passover and Hanukkah), tribute events, etc. Within the framework of the activity, touching personal relationships were established between Ayalon employees and the Holocaust survivors. In 2020, during the coronavirus crisis, the activity increased even more because of the deepening feeling of loneliness among the Holocaust survivors. Ayalon employees participated in the ‘telephone buddy project, within the framework of which each volunteer made personal contact with a Holocaust survivor and was a sympathetic ear for him. The close relationship formed between the employees and the Holocaust survivors continued by choice of the employees even after the end of the project. Moreover, also this year we continued to commemorate the holidays by sending a personal gift to the doorstep of each Holocaust survivor.
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Ayalon supports adults and children with disabilities Shalva Association The Shalva organization works to promote and socially integrate people with disabilities and their family members throughout their lives through a host of programs. Our flagship social project in 2020 was a national fundraising day for Shalva children. In order to produce the event we harnessed our professional and technological abilities for the sake of the fundraising broadcast, during which over five million NIS were donated. 40% of Ayalon employees chose to volunteer for the fundraising day. The donations collected helped provide treatments, support and assistance to children and people with disabilities and their family members. Also
in 2021 we held this significant project and within the framework of the national fundraising day for Shalva children more than five million NIS were donated.
Ayalon supports Children and Youth from Disadvantaged Areas
• Elem Association - The Elem Association provides a response for at-risk youth and adolescents who are in distress, assists those coping with
personal crises and reintegrates those who so require into society. Within the
framework of the collaboration with the Association and within the framework
of our activity to promote at-risk youth, we contribute to the Association both
through financial contribution and through volunteering of the Company’s
employees. This year, our employees volunteered in activities with the youth
at the Associations ‘Coffee and Small Talk’ centers, which provide support, counseling and guidance services to the youth.
• The Israeli Foundation for Olympic Excellence (IFOE) – The Foundation
works to give equal opportunity for Olympic excellence to all echelons of Israeli society and thereby it promotes a culture of equality and excellence. As part of our activities to reduce social disparities in the community, we work
together with the Foundation and we also held a joint sporting activity for the
company’s employees and the Foundation’s children.
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• HaGal Sheli – The Association works to provide an opportunity to improve
the lives of young girls and boys at risk through surfing. Ayalon has adopted
the Educational Surfing Center for at-risk youth, as well as the youth groups
of the Association, and has also participated in the graduation ceremonies of the youth.
• Derech Eretz – An Association that promotes pre-army preparatory programs
for youth from the socio-economic periphery.
• A bag for every student initiative – The initiative is designed to achieve
equality between the students and to allow every girl and boy in Israel to
begin the school year as regular students. In 2020, as well as in 2021, Ayalon
employees volunteered for the project and donated schoolbags for families who
cannot afford to buy a schoolbag.
• Gorgeous initiative An initiative to collect donations of makeup and beauty
products for women and young girls at risk. Our employees donated a thousand
personal makeup and beauty packages and these were sent to thirty shelters
for women victims of violence.
Ayalon supports health services
• The Israel Cancer Association The Association works to promote
awareness of cancer, to prevent morbidity and mortality from the disease and
to improve the welfare of cancer patients. We contribute to the advancement of cancer research, assist sick children who are absent from school due to their disease and are involved in additional projects of the Association.
• Ezer Mizion The largest association in Israel in the medical support field. Ezer Mizion established the National Bone Marrow Donor Registry the largest Jewish registry in the world. Ayalon undertook to fund 555 samples of new
enrollees to the Association’s national registry.
• Larger than Life The ‘Smile Train’ is an initiative of the Larger than Life
Association, which works to improve the quality of life of children with cancer and their family members. In 2020, our employees participated in an initiative
held in honor of the Purim holiday, where the Association’s children and their family members rode on a unique experiential train.
Ayalon’s Social Calendar In 2021, for the third year in a row, we published the ‘Ayalon Social Calendar’. Our calendar, which we distribute, inter alia, to our employees, customers and partners, presents the activities of various associations and reveals the social goals that they promote for the benefit of the general public. The associations and organizations appearing in past years’ calendars include: Larger than Life, Wizo, Amcha, Akim, Bekol organization, Elem, Access Israel and Or Yarok.
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MANAGING THE CONTRIBUTION TO THE COMMUNITY Donating money to organizations and to social programs is an intrinsic part of our community involvement and it is tailored to the group’s social investment policy. Approval of the donations is given – subject to the level of the donation – by the director of the Marketing and Communication Department, the company’s CEO or the group’s Donations Committee, which is composed of management and board members and headed by the company’s CEO.
In 2020, the donation budget of the Ayalon Group stood at NIS 390,616. The following graph shows the distribution of donations by social focus:
Health
21%
Other
13%
Promoting people with disabilities
30%
At-risk youth
27%
Promoting women
5% Supporting holocaust survivors
4%
In 2020, 427 Ayalon employees invested
2,597 volunteer hours as part of the company’s volunteer programs.
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Total annual donations of Ayalon in 2018-2020 In 2018 we donated 509,107 NIS, in 2019 we donated 428,740 NIS, and in 2020 we donated 390,616 NIS. In order to ensure that the donation is utilized in the most effective manner, Ayalon vets the Association in advance comprehensively and thoroughly in terms of the quality of its social programs and its economic conduct. In addition, the security officer of Ayalon vets the Association from the ethical standpoint, from the standpoint of compliance with legal requirements, from the standpoint of managerial integrity, etc. similar to the vetting that suppliers undergo. After giving the donation, Ayalon reviews the success of the social programs for which the money was donated and verifies that the donation indeed helped the cause.
Ayalon is considered a leading donor in Israel in relation to its relative size in the market and its donation percentages from its profits are relatively high. In recent years, the external donation of public companies in Israel stands at 0.35-0.4% of the (pre-tax) profit, whereas in 2019 Ayalon donated 1.7% of its (pre-tax) profit, and in 2018 0.8%4. In total, in 2018-2020 Ayalon donated more than NIS 1.3 million to the community.
VOLUNTEER MANAGEMENT The company’s employees are full partners in the aspiration to create a positive impact on Israeli society. We regard the volunteer program of the group’s employees as a very important contribution to the community and as a tool for connecting the employees to the company and its values, and accordingly, we invest a great deal of resources in our annual social program.
We strive to link the volunteer activities of the employees to the donation giving. Therefore, the projects in which our employees volunteer are led in part by entities to which we donate. In 2020, 427 Ayalon employees invested 2,597 volunteer hours as part of the company’s volunteer programs.
4 2020 ended at a loss and therefore the ratio for 2020 cannot be calculted.
INVOLVEMENT IN THE COMMUNITY DURING THE CORONAVIRUS CRISIS The coronavirus crisis severely impaired the ability of many social organizations to provide a response to a range of populations due to financial and operational difficulties encountered by the social organizations. The social distancing guidelines in many cases foreclosed the ability to continue to volunteer in various spheres and also impaired the flow of donations due to the economic crisis. We at Ayalon made sure to maintain our strategic relationships with various entities in the social sector and continued to assist them as best we could. To this end, we operated in two channels: Creative management of the volunteerism, designed to continue to provide the needs of the various populations, and adding activities outside the work programs to assist in notable challenges facing the organizations.
For example, in order to continue to assist the Holocaust survivors, whose quality of life was substantially impaired by the social distancing requirements, Ayalon employees adopted Holocaust survivors in the ‘telephone buddy’ project and were a sympathetic ear for them. In addition, we chose to strengthen the connection remotely through gifts that we sent to the doorsteps of the Holocaust survivors with a personal postcard from the employees.
Aside from assistance to Holocaust survivors, we worked on holding the national fundraising event for Shalva children. Due to the coronavirus restrictions, the Shalva association was unable to hold the event as planned and Ayalon did much to orchestrate the event and to hold it as a remote fundraising broadcast in a complicated operation and in accordance with the directives of the Ministry of Health.
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PROMOTING SAFE DRIVING IN ISRAEL As a company with extensive activity in the elementary insurance field, we strive to create a safe driving culture among road users and to reduce risky behaviors on the street. The preservation of safety on the roads and observance of a driving culture in Israel is a social challenge of the highest order, since hundreds of people are killed on the streets of Israel every year and tens of thousands more are injured in thousands of road accidents. We believe in our ability to encourage responsible behavior on the street and to improve road safety.
Since the road safety sphere directly touches one of our core business fields, we have extensive knowledge in this sphere, which we utilize in order to promote this important social cause. We operate in two channels to promote safe driving: Integrating incentives for safe driving in our insurance policies and lateral activity to raise awareness of cautious behavior on the street, including providing appropriate tools.
Ayalon invests efforts in creating safe solutions and in developing technological tools that promote safety and influence how the policyholders behave on the road. We provide discounts to policyholders who install technological systems in their cars that help to observe safer driving, such as an ESP stability control system, an LDW lane departure warning system and an FCW system for warning when proper distance is not maintained. Furthermore, we are developing unique insurance products that integrate tools to encourage safe driving. In 2020, we developed the innovative product Ayalon Young and it was launched in early 2021.
Ayalon Young is a unique insurance program and the first of its kind in Israel for young drivers and it offers them unique advantages: Driving with no kilometer restriction, a standard restriction in other policies in the field; the insurance is always in effect – driving without having to activate the insurance at the beginning of each trip, a restriction required in some of the other policies and its non-existence endangers the young driver of driving without insurance coverage; perks that encourage the young driver to drive safely; as well as a possibility to drive cars of the nuclear family that are insured at Ayalon (up to three cars upon purchasing the coverage). The insurance plan includes an app and a sensor that is affixed to the windshield of the car. Via the smart sensor, the app monitors the driving habits of the drivers and sends them tips and pointers for safe and responsible driving. The system analyzes the driving data and rewards safe driving through a 'digital wallet', points that can be converted into perks.
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Moreover, in 2020 we launched Ayalon Driving, a personally customized car insurance policy with a unique discounted track for cautious drivers. Cautious and safe driving reduces the risk of road accidents and enables to lower the costs of policies in the automotive sector. In cases where the driving is safe, we offer the policy at a discounted and attractive price, aiming to encourage continued safe driving and to reduce road accidents. We regularly inform our policyholders of the incentives for safe driving built into the policies, both directly and through our partners, the insurance agents.
Furthermore, in order to promote a responsible and cautious driving culture, we are engaged in a strategic collaboration with the ‘Or Yarok’ Association and hold various activities with said association to raise awareness of safety on the roads. For example, our employees volunteered together with the Association’s representatives for an outreach activity to raise awareness of the dangers inherent in driving under the influence of alcohol. The activity was held with young drivers outside major entertainment complexes at night in an effort to reduce road accidents in general and accidents caused by using alcohol in particular. Moreover, in 2020 we promoted a joint radio campaign on the issue of distracted driving.
Aside from joint activity with the Or Yarok Association, we do much to raise awareness of the risks of driving and provide tools for safe driving to our policyholders; we sent memos and posted on the Company’s website professional information related to road caution. The memos addressed, inter alia, ways in which new and young drivers can be helped to avoid life-endangering mistakes while driving; important information for new and young drivers for driving at night; information for escorts of new drivers; a guide to safe driving in the winter; and a guide to driving and saving car expenses in the summer.
PROMOTING HEALTH A very important social issue at the core of our business activity is maintaining public health. In general, health is maintained both by solving health problems and by promoting a healthy lifestyle to prevent morbidity. We at Ayalon are also working to promote health and to this end, we utilize the extensive professional knowledge at our disposal. We make sure to see the person behind the disease and conduct the activity with an aspiration to provide the most extensive, humane and comprehensive response to the policyholder at the moment of truth.
Our insurance policies are comprehensive and allow our policyholders to receive-when necessary and according to the scope of coverages that they chose to purchase solutions and medical services that are not provided in the public health system. Our health insurances provide our policyholders with a medical and economic response that is tantamount to a protective net against unexpected life events. Through the health insurances, we provide our policyholders with access to innovative medical treatments, complex surgeries abroad and high-priced medications, as well as the ability to finance private medical services. In order to ensure that the policies that we provide are indeed comprehensive, we regularly track the technological and scientific developments in the medical world and make sure to integrate tests, advance medical services and up-to-date medications. For example, in 2020 we added coverage for online medical services. This service enables to receive medical advice from specialists on digital channels. Furthermore, we make sure to provide a comprehensive response in the policy, which addresses the health needs of diverse population groups in Israel.
In order to deepen the added value that we provide to Ayalon policyholders in the health field, we purchased about 40% of the Beit Harofim TLV Medical Center, an advanced and leading private multidisciplinary surgical center. The partnership between Ayalon and Beit Harofim confers an additional advantage to the Company’s policyholders, since they are entitled to receive quality treatments according to the treatments offered on site and to their insurance policies at a medical institute with high availability and level of service, in accordance with the values of Ayalon.
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Beyond the health aspect, we attach great importance to providing a financial safety net to policyholders in cases where the policyholder or his family member have been diagnosed, heaven forbid, with a critical illness. The critical illness insurance - which also includes coverage and compensation when common illnesses not usually covered by this type of insurance are discovered – allows the policyholder and his family to focus on healing and not to go into an economic tailspin in an attempt to obtain funding for the medical treatment.
Furthermore, we are working to promote a healthy lifestyle and to encourage our policyholders to behave in a manner that prevents morbidity ahead of time. For example, we provide our policyholders with professional information on activity to promote a healthy lifestyle through publications and recommendations for healthy conduct, information on proper nutrition and tools for parents to encourage healthy nutrition in the home and among their children. Furthermore, we enable to purchase alternative medicine coverages, as well as coverages that include anti-morbidity initiatives, such as fitness training, meetings with a nutritionist and tests for early detection of diseases.
In 2020, we launched a pilot of a health insurance that includes an economic incentive to maintain a healthy lifestyle. Within this framework, the policyholder is given a discount on the policy. This discount is valid for three years upon renewal of the policy, if the policyholder maintains certain health indicators.
PROMOTING PERSONAL AND ECONOMIC WELFARE We believe that guiding people in planning their economic future and helping them in complex decision-making processes are values of the utmost importance. Financial savings and financial planning for the future are fundamental to affording the personal and economic security and stability of our customers and their family members and their ability to cope with economic and personal crises.
We at Ayalon are working to promote the personal welfare of our policyholders through savings products for a variety of purposes and for different spans of time, from short-term savings for specific purposes, such as purchasing an automobile or funding tuition, to long-term pension savings aimed at allowing members maximum piece of mind when they retire. The Investment Department, which is conducted professionally and responsibly, offers savings products that allow members to invest the funds they have saved in channels that can yield them high returns relative to the level of savings. Moreover, our savings policies allow savers to be exposed to different products, for example private credit transactions, investment funds and direct real estate. In order to ensure that the selected savings are tailored to the needs of the member, we provide agents with comprehensive professional knowledge that allows them to assist the members in making the best decisions for their purposes and their needs.
The total investment portfolio that Ayalon manages for its members is approximately NIS 4.8 billion. In 2020, the return of the largest investment portfolio managed by Ayalon (Portfolio J’) was at a rate of about 5.2%. Our policies are accessible and tailored to the different needs of Israeli citizens and tens of thousands of men and women from all corners of the country purchase our policies for savings purposes.
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Segmentation of savers by age
65+ 51-65 19-50 Up to 18
60% 30%
9.5%
0.5%
In order to make the savings service accessible to all groups in Israeli society, according to their needs, we offer unique investment tracks. For example, a Halachic investment track designed for savers who want their funds invested according to the rules of Jewish law; a unique investment track designed for benefit recipients and managed at the suitable risk level for this population. It should be noted that the varied risk levels that the tracks offer allow the products to be tailored to different ages.
Percentage of savers by district
South Jerusalem North Center Sharon Shfela
62%
38%
60%
40%
66%
34%
60%
40%
60%
40%
62%
38%
13% 13%
19% 19%
26%
10%
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INVESTMENT IN HOUSING FOR IMMIGRANTS FROM THE COMMONWEALTH OF INDEPENDENT STATES Within our real estate investment considerations, social value enters, among other considerations, and in some of our real estate properties we manage affordable housing clusters for the elderly among the new immigrant population. The 939 apartments in these housing clusters serve as a quality permanent housing solution for 1,303 tenants who are entitled to housing according to the definition of the Ministry of Aliyah and Integration. The tenants are exempt from maintenance and management expenses and pay subsidized rent, and in this manner we provide the tenants with a protected and supportive living environment and an opportunity to develop community life.
Ayalon is responsible for managing the housing clusters that it owns, whereas the government housing company and the local authority are responsible for the tenants. We invest a great deal of resources in prudent and measured management of the housing clusters and provide comprehensive maintenance and management se r v ices , emphasizing cleanliness of the public areas. The humanity, one of our core values, is also reflected in housing for immigrants from the Commonwealth of Independent States and we invest a great deal of resources in providing a response to needs exceeding our contractual obligations, in creating value for tenants and in maintaining a pleasant and respectful living environment. We are constantly working to maintain a high level of satisfaction of the tenants and we withstand the audits of the housing
company and the Ministry of Aliyah and Integration.
Some of our efforts in creating value for tenants focus on initiating cultural activities, such as holidays, concerts, celebrations in honor of events, commemoration of remembrance days and other cultural activity with the assistance of a variety of associations. If necessary, we facilitate contact between the associations producing the cultural activity and welfare associations that assist in supplying food and other associations. In addition, we make sure to support the tenants when it comes to dealing with the state institutions, National Insurance, health maintenance organizations and local authorities and in receiving food cards from the state.
During the period of the coronavirus crisis, we invested resources and efforts to prevent the outbreak of the pandemic among the tenants, all of whom are from high-risk populations. We carried out extensive and meticulous disinfection and cleaning operations of the buildings, we carried out outreach operations to encourage the tenants to get vaccinated and professionals performed weekly coronavirus tests on our behalf for all the tenants. Furthermore, Ayalon assisted the tenants during the course of the challenging period by distributing food parcels. As a result of the preventive steps that we took, the number of people in our housing clusters infected with the virus is minimal.
Dispersal of our housing clusters
Haifa (Bat Galim)
Kiryat Motzkin
Hadera
Petah Tikva
Bat Yam
Jerusalem
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INVESTING IN THE ISRAELI ECONOMY PROMOTING BUSINESS ENTREPRENEURSHIP IN ISRAEL Small and medium sized businesses are the backbone of the Israeli economy and they face numerous challenges on a daily basis. In many cases, opening a small business involves many difficulties, as well as the expansion and even the operation of said business. Some of the difficulties stem from risks to which the business owner is exposed merely by his responsibility to his employees, to his customers, to the public and to his other stakeholders. We care constantly working to help our business clients face these challenges.
As an insurance company, our role is to reduce the uncertainty of business owners and to serve as their safety net that will enable them to grow and promote business activity and minimize the concerns that come with these steps. The insurance that we provide to our business customers gives them confidence when making business decisions by virtue of the knowledge that they have insurance coverage and protection included in the policy that they purchased against risk that may be realized for no fault of their own. The safety net allows them to survive in times of crisis and even to emerge from them strengthened. Our business customers are insured with a total scope of coverage exceeding NIS 180 billion for loss of income.
Furthermore, we regularly publish professional information for our customers and the public as a whole that can help entrepreneurs protect their business and assimilate safety principles in their activities to benefit all stakeholders. The publications include information about simple steps that bolster the business’s resistance to cyberattacks as well as professional tools on the subject.
Our business insurances are personally customized to the needs and the risks of each business. The risks include damages to property, thefts, bodily harm to employees and to customers, cyberattacks, loss of income, import and transport risks, structural damages, etc.
Our insurance services encourage local entrepreneurship throughout the country, as reflected in the following table and graph:
Percentage of the businesses from the district of the total insured businesses
Of them, percentage oftiny and smallsized businesses
Of them, percentage ofmedium and large sized businesses
North 15% 71% 29%
Haifa and bay 5% 76% 24%
Center 30% 74% 26%
Tel Aviv 28% 74% 26%
Jerusalem 16% 71% 29%
South 6% 59% 41%
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Segmentation by Business Size
52%
20%
18%
10%
Small Tiny Independent Medium Large
ENCOURAGING CORPORATE RESPONSIBILITY AMONG BUSINESS CUSTOMERS A built-in part of the insurance selling process is encouraging our business customers to promote corporate responsibility measures in a variety of spheres. At the underwriting stage, when the policy terms are established, a surveyor on behalf of Ayalon comes to the business and ascertains in what way the business jeopardizes different stakeholders. Over the course of the dialogue between the surveyor and the business owner, the business owner’s awareness of the importance of these issues naturally increases and the surveyor provides him with tools to promote said issues in the conduct of the business and practical recommendations in a variety of spheres, such as employee safety, customer safety, preventing fires and preventing property damages to the property owner and to neighbors.
In order to ensure that the business owners indeed implement the recommendations, Ayalon offers various incentives built into the policies to encourage said implementation. Among others:
• A contractual undertaking within the framework of the policy
• Requiring external inspections and presentation of certificates of compliance
with the requirements
• Discounts on the premium
• Proactive audits to verify implementation of the recommendations
• In certain cases, refraining from executing the insurance until the necessary
measures are implemented
ASSISTANCE TO BUSINESSES DURING THE PERIOD OF THE CORONAVIRUS The coronavirus crisis severely compromised many of the small and medium sized businesses in Israel. The social distancing requirements in combination with the economic crisis made it difficult for many businesses to operate and they reduced their revenues dramatically. We at Ayalon mobilized to facilitate our customers in several ways in coping with the difficulties of the period: We gave discounts on the premiums due to the slowdown in the market; we gave an extra month of insurance free of charge; in many cases we specifically assisted customers that had difficulty paying the deductible amounts in claims; we gave discounts on the deductible amount; and we spread out the payments according to the needs of the policyholders and for their convenience.
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ENCOURAGING THE AUTHORITIES TO MAINTAIN THE INFRASTRUCTURES WITHIN THEIR DOMAIN Within the framework of our comprehensive insurance activity, we also insure local authorities in Israel. Our insurances allow the authorities, inter alia, to cope with weather damages and a variety of natural events and to maintain a high level of maintenance of the national and local infrastructures within their domain. We insure large municipalities and authorities that provide services and infrastructures to hundreds of thousands of citizens throughout the country and from all the social sectors, among them Tel Aviv Jaffa, Kiryat Yam, Givatayim, Givat Shmuel, Kfar Saba, Qalansuwa, El’ad, Sdot Negev Regional Council, Be’er Sheva, Eilat, Haifa, Sakhnin, Tzfat, Shfar’am, etc.
Aside from the funding that we provide to the local authorities when an insurance event occurs, we provide them with built-in incentives to prepare for such events ahead of time and to reduce the risks within their domain. Already in the underwriting process, we point out safety or other deficiencies in the level of maintenance of certain infrastructures. By providing economic incentives built into the policies, such as reducing the cost of the deductible, the authorities are galvanized to maintain the infrastructures and to augment their level of maintenance.
In recent years, we have witnessed a marked rise in the level of investment in infrastructures in some of the authorities that we insure, in part due to the success of the incentives built into our policies. The integrity of the infrastructures has a significant social and economic impact both in terms of safety and in terms of transportation.
RESPONSIBLE SUPPLY CHAIN The supply chain management at Ayalon is founded on the company’s values. We believe that our values as a company are measured not only among our customers, but among all our stakeholders, including the suppliers from which we consume products and services. Therefore, a humane, transparent and fair relationship with our suppliers is a cornerstone in the management of the procurement processes and we feel that through this kind of relationship we can create extensive value for the economy and for the Israeli economy.
We manage the supply chain in a manner that affords the suppliers and the service providers fair and proper treatment and with the expectation of maintaining a long-standing reciprocal relationship with them and we expect the suppliers to abide by ethical standards that are consistent with our values. Accordingly, the ethical standards of the suppliers are examined by the company’s director of security.
Our high fairness towards the suppliers is reflected, inter alia, in our payment policy. We are aware that our suppliers many of them small businesses are required to meet payments in order to manage the current flow and therefore we pay the suppliers quickly, usually within a time frame less than thirty days from the date the payment request is received. In 2020, 90% of the accounts were paid within a time frame less than fifteen days.
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OUR SUPPLIERS Our operating activities depend on a supply chain consisting of suppliers operating in a host of fields, such as logistics, construction and maintenance of buildings and properties, transportation, office equipment, personnel, professional services and communication infrastructures. We insist on pursuing the highest possible volume of local procurement, and the overwhelming majority of our suppliers are Israeli. In 2020, we purchased from 1,270 suppliers.
SOCIAL PROCUREMENT We are working to augment the social value in our procurement processes by integrating social associations and businesses in the supply chain. This according to our point of view, which champions an economy open to everyone. To augment the equality, we purchased services and gifts for the employees, for the agents and for the community also from social organizations and entities that promote integration of employment of workers with disabilities and special needs, for instance the Access Israel Association, Levinstein House, Mehalev, Asamim Gift Parcels Ltd. etc.
PROTECTING THE ENVIRONMENT The insurance field is one of the business sectors most susceptible to environmental harms and to the climate crisis. The frequent changes in the weather and the rise in extreme climate events significantly raise the environmental risks in the insurance field and lead to a multitude of more acute insurance events. With this understanding, we attach great importance to protecting the environment and invest resources in reducing the environmental impacts of our own and of our stakeholders.
Since we have embraced the value of caring for the individual as our motto, we have enlisted in the global fight against the climate crisis and we are showing environmental responsibility and reducing our direct and indirect environmental impacts to the extent possible. Therefore, we are reducing the impacts caused by the daily operating activities and are encouraging our stakeholders to act in a similar spirit.
REDUCING THE ENVIRONMENTAL FOOTPRINT The environmental impacts of our operating activities are divided into two realms: Energy consumption and greenhouse gas emissions (GHG), and material consumption and waste management. We are working to reduce our environmental impact in both these realms in an effort to ensure sustainable environmental conduct. The environmental impact management is carried out while at the same time taking steps to raise environmental awareness among the employees. In 2021, we launched our flagship environmental program ‘Ayalon Green’, which promotes holistic management of our direct environmental impacts.
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ENERGY CONSUMPTION AND GREENHOUSE GAS EMISSIONS A major source of the company’s greenhouse gas emissions is energy consumed for its operating activities, i.e. operating the offices and the real estate properties and using fuel for the company’s fleet of cars. We invest a great deal of resources in improving energy efficiency to reduce the electricity consumption in the real estate properties. These are the steps taken so far to reduce the electricity consumption: Rolling out control systems to reduce the electricity consumption particularly outside business hours; replacing all the light bulbs with cost effective LED lighting; converting air conditioning systems into more cost effective systems, etc. In addition, we send memos to the employees to raise awareness of proper, safe and efficient electricity consumption.
We purchase electricity from the Israel Electric Corporation, at the same time frequently exploring additional ways to reduce the environmental impact. Thus, for instance, we are exploring the possibility of installing solar panels in some of our real estate properties for self consumption of renewal energy.
Moreover, we are working to decrease air pollution and greenhouse gas emissions from the company’s cars and to improve fuel consumption efficiency. Therefore, we are promoting the integration of hybrid cars into the car fleet and as of the end of 2020, eighty-two cars out of the company’s 124 cars a rate of about 66% are hybrid cars. Along with the safety rating of the vehicles, the environmental rating is a material component in our considerations when introducing additional car models into the fleet. Furthermore, the company encourages the employees to economize fuel consumption and performs regular monitoring of the consumption data to identify and address anomalies.
2020 2019
kWh consumed 1,127,592 1,160,685
Percentage consumed from the Israel Electric Corporation
100% 100%
Built-up square meters 19,000 19,000
Energy intensity 59.35 61.09
Thus, in 2020, we succeeded in reduce the energy intensity of the group by a rate of 2.85%.
2020
Number of cars in fleet 124
Percentage of fuel-efficient cars 66%
Total gasoline consumption 198,313 L
Total diesel consumption 6,612 L
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CARBON FOOTPRINT A carbon footprint is an indicator that assesses the extent of the impact of energy consumption on global warming by measuring the amount of greenhouse gases emitted into the air. The carbon footprint is measured using a calculation tool developed by the Ministry of Environmental Protection. The unit of measurement is a ton equivalent of carbon dioxide (CO2eq). Ayalon’s carbon footprint consists of two components: • Scope 1 The total direct emissions, which at Ayalon originate in fuel consumption
• Scope 2 The total indirect emissions resulting from energy consumption
Scope 3 which measures the indirect emissions originating in the organization’s supply chain and value chain activities, not measured since it is not material to the group’s activities.
2020
Scope 1 emissions (a percentage of the total carbon footprint)
469.59 ton CO2eq (44% of the carbon footprint)
Scope 2 emissions (a percentage of the total carbon footprint)
614.48 ton CO2eq (56% of the carbon footprint)
The total carbon footprint 1,084.07 ton CO2eq
Emission intensity 0.057 ton CO2eq per square meter
MATERIAL CONSUMPTION AND WASTE MANAGEMENT As a company whose principal operating activity is office related, the main materials consumed are paper and toner for offices and mailings. We use three main types of paper products: Standard copier paper, Ayalon logo paper and standard mail envelopes.
By virtue of our commitment to the judicious use of paper, we are working to reduce paper consumption by reducing printings and reducing physical mailings to customers. This streamlining is made possible, in part, through the digital transformation in the service channels and in the internal operating processes, as well as by efficient work management.
2020 2019
White A4 copier paper (units) 11,095 15,495
Solitary Ayalon logo paper (units) 2,536,500 3,609,500
11/23 Envelopes (units) 60,500 74,500
Other materials being used by us are chemical detergents in the offices and at the real estate properties. We make sure to use environmentally friendly materials in properties that we manage directly and at the cleaning companies with which we work. We make sure to recycle the waste that we produce. Our main recycling channel is the paper and about 90% of our waste paper was separated, shredded and transferred for recycling. We also make sure to properly handle other types of waste and to recycle or transfer for reuse electronic devices and furniture no longer used in the offices. It should be noted that in recent years there has been a marked decline in the electronic waste produced in the organization due to the transition to VDI based work. In other words, instead of a physical computer for each employee, the employees connect remotely to virtual machines located on several servers.
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REDUCING INDIRECT ENVIRONMENTAL IMPACTS Our business activities have an impact on the environmental behavior of several elements in our business environment – policyholders, investment targets, etc. Therefore, when planning and conducting business activities – such as designing insurance policies and selecting targets for investment – we also take environmental considerations into account. Through our business behavior, we encourage our stakeholders to reduce their impact on the environment.
For example, we offer an insurance plan that encourages drivers to reduce the use of private cars. The Driving 8000 plan is a discounted insurance policy designed for drivers whose annual amount of kilometers is less than 8,000 km. In order to be eligible for this policy, the drivers must strictly use their cars according to the terms of the policy and whenever possible choose less polluting transportation alternatives.
Also in the investment management activity and in selecting the investment targets we integrate, whenever possible, environmental considerations alongside the financial considerations. In our overseas investments, we examine the ESG indicators of the potential investment targets as part of our decision-making processes. ESG tilted investments have considerable environmental value in tandem with considerable business value for us as an investor, since the companies with higher ESG ratings manage their environmental risks better and are likely to yield higher returns.
GREEN INVESTMENTS AND SOCIAL INVESTMENTS Aside from managing the environmental aspects and risks in the investment activity, we are promoting investment in companies and products with added environmental and social value. This both from the environmental and social awareness underlying the Company’s values and from an understanding of the considerable business value this activity holds for us and for our customers.
In 2020, Ayalon invested in companies and projects with environmental and social value in a total volume of NIS 827 million:
In environmental investments
Renewable energy NIS 42 million
Water desalination NIS 65 million
Waste treatment and circular economy NIS 16 million
Green building NIS 5 million
Other NIS 5 million
In social investments
National infrastructure development (including
Highway 6 and Highway 431) NIS 40 million
Affordable housing (including
assisted living and student housing) NIS 650 million
Other NIS 4 million
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PEOPLE SERVING PEOPLE-OUR SERVICE
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QUALITY AND HUMANE SERVICE
Rendering quality humane service is a principle that has been our motto from the day the Ayalon Group was
established, both as a value and as a key component in
our business strategy.
The company’s slogan, People Serving People, properly reflects this and we invest a
great deal of efforts to implement this concept in the
daily conduct.
Our contact with the policyholders takes place mostly at difficult moments in their lives, when they need support and assistance in facing personal challenges. Rendering
humane, personal and professional service that lessens
difficulties in these moments is of the utmost importance
to us. As part of this concept, we insist on humane
sensitivity and availability through the variety of service
channels and place an emphasis on fair and reliable
service, which affords the policyholders their rights and
helps them face the various challenges.
The company’s values - humanity, service orientation, fairness, innovation – are fundamental in charting the nature of the service that we provide. From them we derived Ayalon’s service level agreement, which establishes the basic principles of our service. The agreement, which was formulated in a comprehensive intra-organizational process in cooperation with the company’s employees, was made public in 2020 out of an approach of transparency and out of our increased commitment to complying with the standards that we set for ourselves. Within this framework, we also published our internal service indicators, which determine our maximum response speed to applicants in the service channels.
The service level agreement establishes that the service is to be rendered according to these four basic principles:
1. Mutual respect for every person for who he is
2. Uncompromising professionalism of the service providers
3. Transparency, clarity and fairness
4. A high level of service and personal attention that allows precise assistance to
be given according to the applicant’s needs.
The quality of the service is led by the service forum headed by the CEO of the Ayalon Insurance Company. The forum, which includes business department heads and service managers, meets frequently in order to monitor the improvement in the service indicators and to assist in solving professional dilemmas. Through the forum’s activity, the service topic receives a great deal of attention, especially from the senior management of the Company and evidenced by the fact that – the data indicates a marked improvement in the level of service and satisfaction of the stakeholders.
As part of making the service accessible to policyholders and agents from diverse groups in the population, and with the understanding that different people have different needs, we are working to diversify and to expand our service channels while ensuring a human response in combination with advanced digital tools.
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Ayalon website which includes an innovate personal area
Telephone service
at the customer service center
and at dedicated call centers
Chat with a
representative on WhatsApp or on Live Chat
Chatbot with Alon, our human bot
E-mail Advanced portal
to service the company’s agents
Public reception
at Ayalon House
Our digital service channels allow the customers to have a direct, immediate and continuous service experience some of the channels are active twenty-four hours a day, seven days a week. In accordance with the values that lead us, we strive to provide a digital service experience as close as to the human communication experience as possible. Along with these innovative channels, we make sure to
maintain and develop also the traditional service channels direct public reception and call centers for the benefit of our clientele that does not wish to receive digital service.
The following are our service channels:
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STRIVING FOR CONSTANT IMPROVEMENT As part of constantly striving towards a high level of service, towards streamlining and improving the quality of the service that we provide, we make sure to continuously measure the service experience of our policyholders. The measurement is carried out on a regular basis throughout the year both by internal service indicators that are made public in the service level agreement (SLA targets) and through service surveys, the results of which are carefully analyzed for the purpose of drawing conclusions, learning lessons and streamlining proposals.
Throughout 2020 we conducted customer service satisfaction surveys in each one of our call centers. All the call centers received an average annual score higher than 79% and half of the centers succeeded in meeting the score that we set as a target – 85%. The towing and rescue call center received the lowest score (79%) and the elementary insurance call center (car and apartment) received the highest average annual score (89%).
We estimate that one of the reasons for the low score that the towing and rescue call center received relative to the other call centers is that this service requires complex cooperation with external entities. Accordingly, we carried out a series of steps to improve the work and the response speed with the entities related to the service.
Apart from satisfaction surveys, we closely measured the service centers’ compliance with the response time targets according to the SLA requirements. After having invested a great deal of resources in this issue, now all the call centers succeed in providing a response to more than 90% of the calls received within less than three minutes. We continue to improve the response times in an effort to reach a situation where all the call centers provide such a fast response to 95% of the calls.
Service satisfaction 2020
89%87%81%79%
Towing and rescue call center
Health call center
Life insurance call center
Car and apartmentcall center
Calls responded within three minutes 2020
92%91% 97%92%95%
Other issues call center
Towing and rescue call center
Health call center
Life insurance call center
Car and apartmentcall center
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Apart from internal surveys that ascertain our level of service, the service is also measured in external surveys conducted by the Ministry of Finance and the Association of Insurance Agents in Israel. In recent years, we have made a marked leap forward in the quality of service, as is evident in these surveys. For example, we were awarded high ratings in satisfaction surveys of the Association of Insurance Agents in Israel that were conducted in recent years.
Ayalon was ranked in first place among the insurance companies, both in
the overall ranking three times in a row and in 85% of the service indicators
examined in the life insurance and pension sector (from 2019 onward).
Ayalon was ranked in first or second place among the insurance
companies in 90% of the parameters and in first place in the overall ranking
in the service and satisfaction survey from the insurance companies in the
health and long-term care insurance field (2019).
Ayalon was ranked in third place among the largest insurance companies
in the survey of agents’ attitudes towards companies in the elementary
insurance field (2020).
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Moreover, in the service index of the Capital Market, Insurance and Savings Authority for 2019, which was published in 2020, we succeeded in improving our relative rating compared to the previous year in 50% of the insurance sectors that were examined. Furthermore, our service satisfaction rating was higher than the average in 88% of the insurance sectors that were examined.
The improvement in the internal and external satisfaction surveys in recent years is a result of large-scale investment in improving the quality of our service by expanding the range of service channels and adherence to the service processes. We created rigorous internal control processes that inspect the level of service of the representatives. Furthermore, we make sure to continue to develop employee capabilities in all matters relating to service and communication with the customers through training, memos and professional guidance. In addition, in 2020 the rollout of an internal knowledge management system in the service sphere continued. The system was also deployed in the sales centers in order to improve the professionalism of the service providers and their access to information.
RESPONDING TO PUBLIC INQUIRIES We at Ayalon encourage our stakeholders to contact us when necessary. Public inquiries, which are received through a variety of channels, are forwarded for handling by the Ombudsman. We invest efforts in the accurate handling of an inquiry while adhering to its designated time frame. Every inquiry received is inspected with serious consideration and handled with reliability, fairness, transparency and efficiency while maintaining the confidentiality of the information and the privacy of the customers. In order to ensure effective handling of inquiries, long-term lesson learning and avoidance of recurring inquiries, a public inquiries forum headed by the CEO and members of management convenes once a quarter and in the course of convening, public inquiries that were handled and with lateral implications are presented and discussed.
In 2020, we handled 951 inquiries, the proportion of which were justified complaints standing at 29.44%. Also when handling complaints we adhere to a fast response. All the inquiries were handled within thirty days or less and more than 70% of the inquiries received a response and were closed within less than seven days.
Segmentation of inquiry reponse time
78 192 681
Inquiries closed within 30 daysInquiries closed within 14 daysInquiries closed within 7 days
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Distribution of complaints handled in 2020
Non-withdrawal of claim
Request pursuant to insurance enrollment circular Conduct failure with agent Dispute related to claim denial Dispute related to claim payment Redemption handling duration
Claim handling duration
Inappropriate service
Plumbing damage
Other
27%
15%
11%
18%
13%
1%
3%
4%
4% 4%
It should be emphasized that in accordance with the importance that we attach to the issue of privacy protection and information security, in the course of 2020 no inquiries or complaints were received on this topic.
SERVICE DURING THE CORONAVIRUS PERIOD With the outbreak of the coronavirus crisis, we arranged to make all the necessary adjustments in order to maintain business continuity and to allow our customers to continue to receive a reachable and professional response. To this end, and in order to maintain the speed of response on WhatsApp, Chatbot and at the call centers, we reinforced the human response in the remote service channels. At the same time, we created a technological infrastructure that allowed the service representatives to work from home and to continue to provide a professional and speedy response to customers and we expanded the options for receiving self-services digitally.
Below is a partial list of the measures implemented in the course of 2020 and designed to streamline and improve the service during the coronavirus period:
Procuring an insurance history certificate through the bot
Ascertaining the existence of
insurance coverage for a car using IVR
Improving the call paths at the claim status call centers
Obtaining forms and certificates
without waiting for a representative
Expanding the service on WhatsApp and on Chatbot for obtaining forms and certificates
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46
CONTENT
AT THE SERVICE OF INSURANCE AGENTS We at Ayalon consider the insurance agents – who serve as our main distribution arm – a key professional entity, partners and an integral part of the company. Accordingly, we have a close relationship with them and have set a goal for ourselves to provide them with quality and advanced service and to develop digital platforms and tools that empower them, streamline their work and increase their added value to the customers.
Therefore, we invest heavily in developing and expanding the service channels and the knowledge for the company’s agents, among them: an advanced agent portal that includes a variety of digital tools and services; regular updates via e-mail and text messages; conferences; and professional training. At the same time, we are developing the personal relationship with the agents through the district system and expose them to the comparative advantages of our products and of our services.
The feedbacks that we regularly receive from the agents help us to improve and to develop products, as well as to maintain a high level of service. When our agents raise needs for various insurance solutions, we make sure to provide them with the best response. Thus, from a need that emerged from the field, we developed unique insurance policies and solutions, such as professional liability insurance for alternative care providers, a dedicated car policy for driving instructors and an insurance policy with customized coverages for synagogues.
The insurance world has undergone a digital transformation over the past few years. As an insurance company that considers its agents as partners, we attach great importance to helping the agents adapt to these changes and successfully face the challenges in the new insurance world.
In the course of 2020, technological projects designed to serve the agents were initiated and promoted, and thus also the policyholders benefit; we implemented an extensive project in the Ayalon agent portal in an effort to upgrade the service experience on the website and the technological capabilities, as well as to promote digital services and the accessibility of the information to the agents. Moreover,
47
we expanded the options to receive services directly on the portal, such as downloading bank transfer confirmations and tax certificates. At the same time, we expanded the digital services for the company’s policyholders on the Ayalon website as an additional service channel.
We are working to provide the agents with a work framework that will ensure compliance with a quality service standard. Ayalon’s engagement contract with the agents defines, among other things, the norms of behavior that are expected of the agents as emissaries of the company. The standard set in the contract relates, inter alia, to Ayalon’s level of service, fairness and ethics, with which the agents who wish to work with us must comply. To ensure proper future service, we conduct comprehensive due diligence for each agent prior to signing the agreement. In addition, we maintain regular controls over the agents in order to ensure compliance with the desired standards when providing service to the policyholders.
We invest heavily in agent training and diverse professional learning through professional training, conferences, memos and digital newsletters. The knowledge conveyed exposes the agents to the comparative advantages of the company’s products and gives them added value and a variety of professional tools. Over the course of 2020, eighteen professional trainings were held for the agents, attended by 2,435 agents. The trainings dealt with a host of issues: The company’s products in the assorted fields of activity; tools for success in sales; workshops on digital marketing, etc. In addition, miscellaneous professional information was conveyed in a variety of spheres, including updates regarding new regulatory guidelines, updates and innovations in the insurance products, benefits for the company’s customers, etc.
SERVICE TO THE AGENTS DURING THE CORONAVIRUS CRISIS Among the policyholders, the coronavirus crisis heightened the importance of the insurance agent and the knowledge that the agent will be by their side at the moment of truth and will help them make informed insurance and financial decisions. We also stood by our agents during this time and helped them overcome the crisis and maximize its inherent opportunities: Strengthening of the relationship with the policyholders, increasing their value for the customers and streamlining the manner of providing the service.
We worked to make it easier for the agents to carry on with continuous joint business activity even when working from home. To this end, we made adjustments in the manner of providing the service so that they would afford maximum flexibility and assist in providing the best service to the customers during this time. Moreover, taking into consideration the economic challenges that arose at this time, we advanced the commission payments to the agents leading up to the Passover holiday.
During the coronavirus crisis, we provided digital human service to the agents through remote channels while ensuring to preserve the personal relationship. According to the changing needs during the coronavirus period, we offered unique benefits to the agents in insurance prices on the relevant tracks, such as cyber insurance, the importance of which rose given the transition to working from home; in the deferment of payments and in insurances adapted to the situation. In addition, we offered a series of new digital tools to help the agents and their customers receive fast remote service during the period. For example, receiving a no claim certificate through the bot; renewing policies by sending a text message to the policyholder with a link to renew the policy independently; adding temporary coverage for a young driver and a new driver on the digital channels independently. In addition, coverage extension solutions were offered to agents in business, car and apartment insurances.
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CONTENT
FAIRNESS IN SERVICE We at Ayalon are mindful to act fairly and transparently with all our stakeholders, and particularly with our customers and our agents. These values underpin the Company’s business operations and they are basic principles of conduct of all employees in the group.
We make the needs of the customers our top priority and assist them in making decisions in an informed manner tailored to their needs while fully protecting their rights. In addition, we insist on full disclosure of information and on making it accessible to the applicants, and of course – advertise all our services and products in accordance with the provisions of the law. Fair disclosure of information – which reflects ethical conduct that is expected of us as
an insurance company and helps to maintain the trust of the agents and those insured with us – is a fundamental principle for us.
In order to ensure that fairness is fully implemented, our fairness policy is part of the group’s compliance policy. Ayalon maintains a compliance program and enforcement that examines from a multi-year perspective the actual implementation of all the relevant provisions of law. The aim of the program is to create mechanisms that will ensure compliance with the fairness principles vis-à-vis the service recipients. In light of the great importance that we attach to ethical, responsible and fair conduct, we employ a variety of control measures with regard to compliance with procedures, for instance, through monitoring and control of calls at the call centers; feedback conversation with call center employees; analyzing customer complaints; and providing professional call scripts in order to provide clear guidelines for conducting optimal calls with the customers. The controls over this sphere are carried out in accordance with the advanced practices of conduct risk management.
Protecting the full rights of the policyholders as part of fair conduct towards them is a paramount value for us and we invest considerable resources to uphold this value. The issue is controlled, inter alia, by the Control and Regulation Department and by the internal auditor.
When it comes to fairness in advertising, we advertise and market products and services while ensuring accurate information in order to make sure that the messages are not misleading our customers. We work to advertise our products in a proper and respectful manner out of consideration for public feelings. In accordance with the fairness principle to which we are committed, we provide fair and equitable service to all the applicants, regardless of religion, race, gender, sector, sexual orientation or any other attributing trait. In 2020, no complaints of discrimination in the provision of services were received.
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ACCESSIBLE AND INCLUSIVE SERVICE Promoting accessibility and providing an equitable and respectful service to every person is our core fundamental value. Therefore, we harness our organizational capabilities to promote equitable service for people with disabilities, both using technological tools to make different service channels accessible and by providing physical accessibility to the group’s buildings. In order to supervise the accessibility actions, an accessibility coordinator is appointed, and he is responsible for promoting and maintaining our high level of accessibility.
An example of an accessible service channel is our website, which is fully accessible and allows people with disabilities and people who have difficulty using digital channels to make effective use of the site, just as all the customers. The process of making the site accessible was carried out in cooperation with the Access Israel Association, and the site has been in compliance with the requirements of the Equal Rights for People with Disabilities Regulations since 2018. In order to ensure a quality and equitable service experience for all the policyholders, Ayalon employees undergo training with regard to providing accessible service for people with disabilities. All the accessibility arrangements on the service channels and in the company’s buildings are posted for the public on the company’s website. For our activities to promote accessibility for people with disabilities, already in 2018, as well as in 2021, Ayalon was awarded the Accessible Organization Badge of Honor by the Access Israel Association, one of the leading associations in the field.
Aside from providing accessibility for people with disabilities, we made the varied service channels accessible to people from different personal backgrounds through multiple languages. We undertake to provide service in the language in which the customer wishes to receive service, and if at the moment of the customer’s inquiry no service person is found who speaks the desired language, we undertake to get back to him within twenty-four hours from the moment of the inquiry in the requested language.
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CONTENT
INNOVATION Innovation is a basic component in our business strategy and therefore we invest a great deal of resources in developing innovative products and in integrating unique technologies in the products, in the service processes and in the work processes. The innovation management relates to all the work aspects in the company, and we are mindful to develop and roll out technologies for the benefit of all the stakeholders, including employees, policyholders and agents.
For the sake of streamlining the service to the customer and developing new services, our innovation team is engaged in rolling out advanced technologies in the business and operational activities, particularly in promoting a digital transformation in the work processes and in the existing services.
In order to ensure that the innovation that we promote generates maximum value for all the stakeholders, we integrate our stakeholders, particularly employees and agents, in the innovation development and planning process and hold round tables with agents to map their needs when it comes to the digital channels. Furthermore, we listen to the needs arising from other stakeholders and work to provide creative and technological insurance solutions for them.
An example of integrating the stakeholders in promoting innovation is the hackathon for employees that was held in 2020, titled ‘From Crisis to Opportunity’. In the hackathon, the employees suggested ideas for initiatives that promote
innovation in service. Among the initiatives that were promoted: A system to assess eligibility to file a claim without having to wait for a representative; combining the car insurances with additional car services; automatic underwriting for health declarations; a communication and information app for agents; an app to activate coverages in real time, etc. Moreover, we established an incubator for startups in the insurance field (insure-tech). In doing so, we are realizing the tremendous inherent potential among us for the Israeli innovation arena while at the same time helping promising Israeli startups grow and gain considerable market experience.
Our innovation is reflected in the roll out of innovative technologies throughout the work processes. For example, we are rolling out a machine learning technology in order to perform efficient and fast claim settlement processes – according to the profile of the customer and the claim and based on data and past experience. Furthermore, we rolled out organizational learning and management systems that help employees perform their jobs more efficiently.
We integrate technologies in the digital and traditional services while streamlining the service provided in an effort to generate significant value for the stakeholders. As part of the concept that digital transformation is a tool that supports improving service, we invest efforts in transferring existing services to a variety of digital channels. We enable the customers to obtain information and to perform actions independently on the digital channels, such as filing claims, redeeming a policy,
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PRODUCT INNOVATION Product innovation is a part of our core work at Ayalon, and its goal is to continue to develop leading and differentiating products that will provide added value to the company’s customers and agents. The company’s experts are thoroughly familiar with the key needs of the stakeholders and therefore in order for the innovative developments to answer the needs of the stakeholders, and as part of the employee involvement policy, each business unit at Ayalon is required to incorporate ideas for product innovation relevant to its work in its annual work plan.
Below are a few of the innovative products that were developed over the course of 2020, some of which were launched in 2021: • Ayalon Young – A digital car insurance for young drivers, which was built according to the common value principles. The product was developed as
part of our aspiration to encourage safe driving and to reduce road accidents
in Israel. The insurance incentivizes young drivers to drive safely through a
dedicated and innovative app, which provides perks for careful behavior on
the road. • Ayalon Living – Customized personal apartment insurance, the first of its
kind in the apartment insurance sector in Israel, which allows a policyholder to purchase apartment insurance with coverages relevant to his needs and
thereby also reflecting values of fairness. • Business cyber policies Acknowledging that cyber events have become
a real threat, we developed the policy in order to provide protection for businesses due to cyber events that are liable to compromise the information
systems, hardware, software and information. • Cyber policies in apartment insurance – Digital coverage that includes a
dedicated app that monitors the electrical appliances in the home and alerts
you to cyber risks.
cancelling a policy, filling out forms, sending documents, receiving a price quote, a claim status update, purchasing insurances, etc. At the same time, we are working to expand the services that can be received through Alon, our human chatbot, which include, inter alia, ordering a tow truck, updating methods of payment, adding coverage for an occasional young driver, cancelling a policy, checking claim status, finding an appraiser, etc. Moreover, we are expanding the digital service options in a variety of fields, for instance payments on apps and ordering a tow truck through an app. We conduct service surveys to check ease of use on the digital channels. We send the surveys as soon as the activity is completed to the policyholder to gain an indicator with regard to the quality of service.
In accordance with our values, we make sure to maintain humanity also when rolling out the technologies at the company, for instance we ensured that Alon the bot would provide the service recipients with an experience as close as possible to the human response.
Moreover, we ensure that the innovation supports the employees and allows them to maximize their skills. In this manner, implementing a digital transformation for the various work processes allows our employees to use their skills and professionalism and to invest their efforts in solutions to complex problems for the benefit of all the stakeholders and to minimize the time spent on repetitive actions.
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THE IMPACT OF THE CORONAVIRUS CRISIS ON THE USE OF DIGITAL CHANNELS
The coronavirus pandemic has impacted daily conduct in various aspects of our lives, inter alia, the consumption of services on the digital channels. Many customers and agents derived a great deal of value from their availability, efficiency and ease of use. Our investment in technology and digital in recent years led to our level of preparedness for the crisis being extremely high. It allowed us to maintain business continuity and continuity in the quality of service while responding very quickly to the changing needs during the dynamic and challenging period.
During the coronavirus period, we expanded the options for using the digital channels and created new communication platforms. It was found that the volumes of their use rose markedly. Examples of actions and trends that began during the coronavirus crisis:
More than 43% of the service inquiries of the company’s customers
were handled in the digital service channels
Growth of over 30% in the use of the personal area
on Ayalon’s website
An increase by a rate of
approximately 28% in the quantity of users of the bot
services on Ayalon’s website
Growth by tens of percent in the
online purchase of temporary coverage for a young driver on
Ayalon’s website
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CONTENT
INSTILLING THE CODE OF ETHICS The code of ethics was adopted by the board of directors, and it applies to each one of the officers of the company its managers and its employees. The code has an impact on the organizational culture and character and we attached great importance to implementing the same in the company’s business activities. Accordingly, we invest a great deal of resources in an attempt to ensure that each employee knows that he is expected to comply with the principles of the code. Aside from its role as a compass, the code of ethics serves as a means for solving ethical dilemmas that the employees encounter in their day-to-day work.
As part of the efforts to instill the code of ethics, the board of directors appointed the director of the Headquarters, Innovation and Human Resources Department to be the person in charge of implementing the provisions of the code of ethics in the company. She is responsible for holding periodic ethics training, for managing employee ethic-related inquiries, for instilling the code of ethics among the employees and for assisting in solving dilemmas in anything involving inappropriate conduct under the rules of ethics. The examination of compliance with the code of ethics is included within the multi-year work plan of the internal auditor. The most recent audit reports were discussed by the board of directors at the end of 2018 and were prepared by an external entity.
We encourage the employees to have an open discourse, to consult with us and to alert if necessary, particularly on ethics-related issues. Therefore, we have put in place internal reporting and consulting mechanisms for dealing with ethical dilemmas that the employees encounter in the line of duty. If a suspicion of serious ethical violations among the employees or the management arises, the employee can report this to the VP of Human Resources, the CEO of the company or the legal counsel of the company at his convenience. Moreover, the employee can contact anonymously for advice or reporting also on the organizational portal.
We are committed to handling reports of violations of the provisions of the code of ethics with maximum discretion while protecting the reporting employee from any persecution or harm. We expect the company’s employees to report any unusual
ETHICS AND PRINCIPLED MANAGEMENT We at Ayalon manage our business activities in accordance with the company’s values ethical, fair and moral conduct towards all stakeholders and work to ensure a high and uncompromising standard on the ethical plain. Maintaining the trust of the policyholders is a paramount value for us and it ensures that the policyholders will know that in the moment of truth we will be by their side.
Our organizational culture is based on ethical foundations. As part of our efforts to ensure that all the employees are aware of the standard expected of them, we have adopted an organizational code of ethics. This code is our organizational conscience and compass, which establishes the rules of conduct of the company and of all its employees in day-to-day conduct and with the stakeholders. The code of ethics defines the norms of behavior expected of Ayalon employees and its partners and we are working to instill it in the company and among the employees. The code is posted for the public on our website so that the stakeholders will also be able to know what they should expect from the parties who provide service to them on the company’s behalf and are in contact with them.
The principles of conduct that our code of ethics explicitly define include: Conducting business with integrity; fairness and reliability; giving respect to every person; fair trade and free competition; observing the provisions of the law; professionalism and excellence; objectivity and avoiding conflict of interest; avoiding abuse of position; creating and maintaining a healthy, safe and pleasant work environment; and privacy and confidentiality of information. When suspicions of ethical violations arise, the company investigates them thoroughly and a lessons learned process is carried out to prevent the recurrence of the incident.
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54
extreme action that is inconsistent with the company’s rules of conduct and this expectation is conveyed to the employees on a regular basis. In the course of 2020, no inquiries related to ethical violations were received on the reporting channels.
A key tool in instilling the code of ethics among the employees is a series of dedicated courseware. The courseware deals with code of ethics related topics, preventing sexual harassment, business conduct, information security, security and safety. Each new employee is required to study the courseware and all the employees are required to study it once a year. In addition to this courseware, there is courseware on the topics of money laundering and economic competition, which are mandatory for employees for whom the topic is relevant to their position.
Percentage of employees who have completed study of the courseware in 2020
86.04% 90.30%88.71%90%88.12%
Code of Information Security and Business Preventing ethics security safety conduct sexual
harassment
An additional means for maintaining integrity in the company is anchoring different aspects of the code of ethics requirements in clear work procedures. The procedures detailing what is written in the code of ethics and supplementing the same include: Procedure for reporting suspected embezzlements and frauds and non-compliance with the provisions of law; third party engagement procedure; procedure for dealing with embezzlements and frauds; compliance and internal enforcement procedure; business conduct procedure; goods and services procurement procedure, etc.
Certain aspects of the code of ethics, such as procedures pertaining to the work environment and conflicts of interest, are included in the collective labor agreement. Moreover, as part of the management of embezzlement and fraud risks in the organization, there are specific procedures pertaining to particular departments or particular positions, depending on the areas of activity identified as being prone to embezzlements. For example, the gift procedure in the Investment Department is designed to ensure that the investment management is carried out solely with a view to the best interests of the members.
COMPLIANCE WITH THE PROVISIONS OF THE LAW One of the fundamental themes in the worlds of ethics and maintaining integrity in business conduct is observing full compliance with the provisions of the law. As part of the compliance and regulation risk management concept, we attach utmost importance to proper conduct and compliance with relevant laws and regulations. Therefore, we make sure to implement the provisions of the law – these direct our actions and the fields in which we are allowed to operate. Apart from this, we are aware that the implementation of the provisions of the law has a considerable impact also on our ability to maintain the trust of our customers and the other stakeholders. We take a variety of measures to create systemic mechanisms in an effort to ensure compliance with the provisions of the law while developing a culture of regulatory compliance. Over the course 2020, no penalties were received and no other sanctions were imposed due to regulatory non-compliance.
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The person in charge of our internal compliance and enforcement guides the business activity with all its regulatory aspects and is responsible for the processes of monitoring, control and reporting to the relevant entities within and outside the group. He is also responsible for receiving new regulatory directives, forwarding them to the relevant entities and ensuring that they are instilled in the work processes and finally compliance with said directives. As a supplementary step, regular and periodic controls are conducted over the compliance with regulations and with statutory requirements. The controls and instillation of the compliance culture in the business departments is led by an array of fifteen control supervisors deployed in all the company’s business units. Our activity in the compliance sphere is carried out in accordance with the organizational compliance policy that was approved by the board of directors.
As part of the process of building and instilling a compliance culture in the company, all the company’s employees undergo trainings on the topic of compliance with the provisions of the law. In addition, every new employee undergoes training on the topic by the person in charge of compliance as part of the induction process. Apart from the trainings, in 2020 a compliance campaign was conducted throughout the group that was designed to raise the awareness of the importance of compliance and to instill the compliance culture among the employees. The campaign included memos related to the topic, branded aids, etc. The employees have an anonymous channel at their disposal for reporting regulatory violations. In 2020, no inquiries were received on said channel.
PRIVACY AND INFORMATION SECURITY
As an insurance company, we manage personal and sensitive information of our customers. Whether involving personal, medical, financial or insurance history information the information is highly sensitive and and we take the responsibility involved with holding the information very seriously. Therefore, maintaining information privacy and security is of the utmost importance to us and we invest a great deal of resources in order to ensure that the information in our possession is protected in an optimal manner. To this end, we assimilate innovative information security technologies and an organizational culture of information security and protection of privacy in accordance with advanced work methodologies in the field. We are certified to the global information security standard ISO-27001.
Our privacy policy addresses, inter alia, the relevant statutory requirements and the relevant regulations in the field and allows access to the information to authorized entities. It establishes the internal governance structure in the privacy and information security sphere and the orderly work processes for managing the sphere. Our privacy policy applies to all the officers in the group, including the management, the board of directors and any entity operating under contract with the group. In order to maintain the high standard in the sphere, a dedicated steering committee was established which is part of the cyber and IT committee which is responsible for the proper implementation of the privacy policy at the
company. The committee convenes once every quarter to discuss information security and privacy protection in their varied aspects. The duties of the committee include, inter alia, establishing an appropriate and suitable organizational structure for privacy protection; appointing position holders and defining their areas of responsibility; approving annual work plans in the privacy protection sphere; handling incidents of violations of information security guidelines in the group; approving and updating privacy protection procedures in the policy document, etc.
In order to manage the sphere on an ongoing basis, an information security officer
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56
and a privacy protection officer were appointed. Their duties include, inter alia, preparing relevant procedures; control plans and monitoring the implementation thereof; planning and conducting information security surveys; and managing the protection of the communication and information systems. The information security officer is responsible for the technological aspect of protecting and managing the databases, and he is part of the company’s Control Department. The privacy protection officer the holder of the position is part of the Legal Counsel Department and the Company Secretariat is responsible for the proper use of the information.
Ayalon invests a great deal of resources to ensure controlled and responsible management of the databases, so that the access to the information will only be allowed to authorized entities and holders of appropriate authorizations. Whenever there is a concern of information being compromised or unauthorized use, the information security office handles the incident and reports it to the appropriate entities.
Beyond the use of advance security technologies that we have rolled out, we perform controls for regular monitoring of the network by authorized entities twenty-four hours a day, seven days a week. This in order to ensure that the network is indeed resistant to varied intrusion attempts and that the information kept there is well protected.
We work tirelessly to heighten employee and business partner awareness of the topic of information security, inter alia, trough trainings, controls and memos. We are aware that proper and informed conduct of the employees with access to the systems can prevent many security risk, and therefore we invest heavily in raising their awareness of the subject. We hold privacy protection training using courseware as part of the new employee induction process and once a year administer to longtime employees refresher courseware regarding information security procedures. Over the course of 2020, 909 employees, which constitute 90% of all the employees, completed courseware on the topic of information security. Aside from the training, in order to raise awareness, the Control and Regulation Department sends professional memos on the topic to all the
employees once a week, conducts ‘clean desk’ inspections for employees and distributes newsletters on the topic of privacy and information security.
We are working to instill the importance of information security also in our business partners and throughout the entire supply chain. Each one of our suppliers signs an information security appendix as part of the engagement contract. Moreover, we are currently undergoing a process of examining the level of information security among the suppliers. In addition, we are working to raise the level of awareness of the topic also among the suppliers both by means of the conduct agreement that they sign and by means of dedicated memos.
The heavy investment in this sphere pays off. In 2020, no complaints were received with regard to privacy violations or loss of customer information. Moreover, no information security incidents were detected during the year.
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PEOPLE SERVING PEOPLE-
AT THE SERVICE OF OUR EMPLOYEES
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58
OUR PEOPLE As a company where humanity is one of its core values, we at Ayalon attach great importance to the welfare of our people and invest in developing and retaining the human capital of the company. Our employees are a major factor in the company’s success and we invest a great deal of resources in recruiting and retaining quality human capital in the company over time. We see each one of the employees as a unique person with personal needs and aspirations and provide him with tools that will enable him to grow and to develop within the organization. Therefore, we manage a respectful, pleasant and inclusive work environment, which enables our employees to maximize their abilities. Moreover, we invest in the constant cultivation and development of the employees’ skills at the professional and the personal level.
Our human resources strategy and the humane and family oriented organizational culture are a major factor in the company’s success. The management of the work environment is led in the organization by the Headquarters, Innovation and Human Resources Department, in full collaboration with the professional managers in all the organization’s units and departments. These collaborations are a major key to our success in retaining and developing the high standard of the work environment in the organization and we continue to promote them.
As with the relations with the other stakeholders, we maintain complete fairness towards our employees and behave transparently towards them. The terms of employment in the organization are fair and appropriate even beyond statutory requirements and protect the employees’ rights. Our intra-organizational communication mechanisms allow the employees to take an active part in promoting the organization and to create an effective and fruitful organizational discourse for the benefit of the employees and for the benefit of the organization.
1,137 employees
are employed in the
Ayalon group, 1,010 of them work at Ayalon
Insurance Company
97.2% the percentage of workers who are
employed full time
42 years –
the average age of Ayalon
employees
6.6 years
the average seniority of Ayalon employees
938 employees
are employed under a collective labor agreement – which are
82.5% of the company’s
employees
71.77% of the group’s employees
are women
60.3% of the managers in the
group are women
129 – additional jobs
that we created in the
course of 2020. This is
growth of over 12% in
the number of people
employed in the group.
50 female employees
went on maternity leave
in the course of 2020, of them 43 employees
returned from maternity
leave to their previous
position during the year
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Ayalon employees by gender segmentation in 2020
28%
72%
Ayalon employees by gender and age segmentation 2020
Employeesup to age 30
Employeesaged 30-50
Employeesaged 50+
110
176
35
196 459 161
Ayalon employees by gender and management level segmentation
Senior managers
Mid-level managers
First-level managers
Employees
725
92 36 7 40 23 22
192
Women Men
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Distribution of Ayalon Employees by Place of Residence
North
South
Shfela
Jerusalem
6134
1611
4613 4613 4022
Center and Gush Dan561198
Sharon 9144
Induction and Departure of Employees in the Ayalon Group in 2020
Induction
Women Men Total
Up to age 30 74 28 102
30–50 57 24 81
Age 50 and older 10 8 18
Total 141 60 201
Departure
Up to age 30 32 4 36
30–50 19 7 26
Age 50 and older 3 7 10
Total 54 18 72
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A CULTURE OF OPENNESS AND PARTNERSHIP As a company that considers employees full partners in the company’s work and success, we are working to promote an organizational culture of partnership, dialogue, openness, appreciation and mutual feedback. Open and multi-directional intra-organizational communication in general, and between the management and the employees in particular, promotes a healthy work environment and a culture of creativity and innovation, two critical elements in the ability to succeed over time. We believe that such quality communication enhances the work of the employees at the heart of the business operations, strengthens their involvement in management processes and heightens their sense of partnership and connectedness to the company. Thus, also the company and also the stakeholders benefit from a common added value.
Therefore, and in order to create an open and free discourse based on trust, we maintain a variety of communication channels, formal and informal. The leading internal communication mechanisms include: Round table events; performance evaluation processes; the organizational portal; a mobile app for intra-organizational communication; the employees’ personal relationship with managers and employees of the Human Resources Department; organizational surveys, etc.
DISCOURSE BETWEEN MANAGEMENT AND EMPLOYEES Open communication between the various levels of management and the employees is the foundation for a transparent culture of dialogue. Therefore, we make sure to keep a variety of communication channels open between management and employees. Ayalon’s management insists on holding round tables with the employees with the participation of the CEO of the company and department managers in order to feel the mindset, to identify challenges or
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issues that bother the employees, as well as to explore various professional and personal opportunities. These meetings are a real window of opportunity for the employees to present to the key decision makers in the organization suggestions for improvement and issues for retention and strengthening and thus to influence processes and the mindsets in the company.
The insistence on holding these events directly reflects the degree of our commitment to creating a collaborative, professional and quality work environment. In the course of 2020, twelve round table meetings of department managers were held with their department employees. The key issues that were raised in these meetings revolved around the effects of the coronavirus crisis and remote work, which was a consequence of the crisis and characterized the period. The CEO of Ayalon Insurance Company also held round table meetings and feedforward conversations were held between the CEO and the employees.
The sharing of professional information within the company is of the utmost importance to us, since sharing broadens the professional and organizational knowledge of the employees and increases their familiarity with processes taking place within the group. Therefore, aside from the unmediated meetings, we use built-in channels to transmit messages from the management or from the various headquarter units to all the employees, for instance we send memos on various topics and make use of the organizational portal – the key communication channel of the company. The portal enables access to professional documents, and in this manner, by displaying accessible and up-to-date information, work processes are streamlined. The portal is also used as a tool that generates a common organizational language, encourages transparency and communication and contributes to the feeling of organizational connectedness.
Another effective tool for improving and streamlining the organization activity and for learning the mindset among the employees is organizational surveys. Through the surveys, the organizational climate and the extent of employee satisfaction with different aspects of the work environment are examined. In order to enable the headquarters and management to learn effectively from the surveys, we conduct multiple surveys regarding specific topics throughout the year and not a general
annual survey, which produces data from which it is difficult to draw concrete conclusions.
Over the course of 2020, varied surveys were conducted on various topics, including management programs, organizational connectedness, the dining room and intra-organizational service. In the wake of these surveys, we learned lessons and implemented measures to fulfill employee expectations as reflected in the results. For example, over the course of 2020, we launched an intra-organizational app, we improved the menu in the dining room, and so on.
EMPLOYEES’ COMMITTEE The labor relations at Ayalon and the relationship between the company management and the employees’ committee are characterized by partnership, transparency and open communication. The employees’ committee of Ayalon Insurance Company was first established in 2016 within the framework of the National Federation of Labor. As of 2020, the committee members comprise 651 employees, which constitute 65.5% of the employees of Ayalon Insurance Company.
In 2018, a collective employment agreement was signed for the first time between Ayalon Insurance Company, the National Federation of Labor and the employees’ committee. The collective agreement also applies to the subsidiaries and the ‘Neemanim’ and ‘Hachi Bari’ insurance agencies. Following successful negotiations, which were conducted with full cooperation between the parties, the agreement was signed. This agreement is valid for four years, including at the time of writing the report. The agreement deals with working conditions and fringe benefits for employees, working hours, employee rights, etc. 938 employees of Ayalon Insurance Company and the subsidiaries are employed under a collective labor agreement. This employee class constitutes 92.9% of the employees of Ayalon Insurance Company and 82.5% of the employees of the Ayalon group as a whole.
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EMPLOYEE TRAINING AND DEVELOPMENT As a company that believes that the human capital in the organization is the key to the company’s success and prosperity, we choose to empower our employees, to cultivate and to develop the human resource. Therefore, we invest in developing the employees both at the level of the professional knowledge and in soft personal skills, which are required for success in the modern workplace. We do so by instilling a culture of constant learning and provide the employees and managers with tools and platforms for development and growth. The organizational education and training programs empower the employees and provide them with the professional toolbox they require to perform their duties in an optimal manner.
EMPLOYEE EDUCATION One of our tools for creating value for the employees is developing their professional skills in a manner that encourages personal growth and improved performance. The professional trainings are provided via several frameworks, according to the needs of the employees and the departments. In each department an annual professional education program is built, which is tailored to the needs of the departments as these are revealed in the department’s mapping results. The education programs are built in collaboration between the education department and the professional managers and include regular internal courses, external courses and seminars, as well as individual training provided by the leading Ayalon professionals in the various disciplines. Among other things, we provide education on innovation and digital topics and also encourage development of the employees in these worlds through unconventional tools, such as our hackathon.
A rate of approximately 50% of the annual education budget is invested in funding external professional education for employees on a variety of topics, from technological courses to professional seminars in the insurance field. In 2020, ninety-one employees participated in external courses and seminars in a total scope of 8,862 hours.
We make sure to examine the effectiveness of the education programs and the various courses using surveys and feedback conversations with the employees and the managers. These internal learning processes allow us to improve and to increase the value that the employees derive from the program.
Our flagship education project is Ayalon College, a unique platform that provides tools and guidance to employees, where the employees are exposed to a variety of courses in professional fields, courses focusing on personal skills and enrichment courses. The course topics include: General insurance, health insurances, long-term savings, computer applications, self-management and ergonomics. In total, 512 employees participated in formal education during the year in a total scope of 12,246 hours. This is an average of 10.7 education hours per group employee. This figure does not include annual compulsory trainings in the sphere of ethics and regulation. The prominent courses included a business-underwriting course, a workshop for dealing with stress, excel and power point courses, tools for self-management, etc.
MANAGER DEVELOPMENT For us at Ayalon, it is strategically important to develop the organizational managerial backbone. In order to develop a respectful, connecting and effective work environment for all the employees, we invest resources in developing and cultivating the managers. Solid management foundations, reinforced by effective tools for dealing with managerial challenges, are a necessary condition for the long-term success of the company and for the continued satisfaction of our people.
Therefore, we have formulated an education program for the development of managers at different levels. Aside from dedicated leadership development education, we place at the disposal of the managers a host of tools to encourage personal and managerial growth and to assist in facing various challenges. The tools include: Mentoring processes by internal and external professional parties
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for dealing with specific issues; built-in channels for peer instruction, etc. In 2020, about seventy-six managers – 34.7% of the managers in the group – participated in unique courses for the development and training of managers in a variety of topics in a total scope of 1,604 hours. The following are several of the courses taught within this program: Development of team leaders, development of department managers and an interview workshop. In total, on average 7.3 hours of annual management development and education were provided to each manager in the group.
LEARNING DURING THE CORONAVIRUS PERIOD The coronavirus crisis accelerated a change in the perception of organizational learning and required us to adapt the training processes to the reality of social distancing. Therefore, we moved the education system to a digital platform, which enables continuous remote learning. In the case of specific education taught frontally during this period, the employees were divided into small groups and the education was carried out in accordance with Ministry of Health guidelines while ensuring a safe work environment to protect employee health. It should be noted that the learning in small groups achieved an increase in the effectiveness of the training.
The educational content was adapted to the changing needs of the employees and the managers in light of the coronavirus crisis. The new topics that arose were effective remote management and work, self-management, dealing with stress, time management, etc. The adjustments were also made in the traditional course content, according to the changing needs during this period.
PERFORMANCE EVALUATION As part of our aspiration to promote a culture that fosters excellence and professionalism, we conduct a periodic performance evaluation process for the company’s employees and within the framework of this process, the employees receive feedback regarding their performance and functioning in the past year. This process allows the employees and managers to identify points of strength and points for improvement – both through the employee’s self-reflection and by receiving feedback from the manager. The process is an intrinsic part of the organizational learning model and it is built so that we can develop and elevate the capabilities of the employees. Moreover, the evaluation conversations are a structured opportunity for open dialogue between the manager and his employees, which facilitates discussion of various issues pertaining to the work environment at the professional and the personal level.
The performance evaluation process with respect to 2020, which consists of several stages of self-work and joint work of the employee and the manager, ended in April 2021. The rate of employees who received frontal feedback was approximately 90%.
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EMPLOYMENT AND WORKING CONDITIONS The working conditions at Ayalon consist of several components: Wage and fringe benefits, a work routine and physical conditions at the company’s offices. The employee wages are set according to the collective labor agreement or personal agreements. Ayalon provides unique benefits to employees who leverage its comparative advantage as an insurance company. The benefits due to the employees include management fee discounts in the provident and study funds, as well as insurances and savings policies at discounted rates or at no cost. Some of the benefits are also given to the families of the employees. Moreover, in many cases, the employees have an opportunity to be the first to experience Ayalon’s innovative insurance products, before the products go to market.
Furthermore, we invest a great deal of resources in promoting the welfare of the employees and their family members with the intention of improving the organizational climate and the employees’ sense of belonging and connectedness to the company. For this reason, we hold a variety of wellness events for the employees and their family members, such as an event for first grade children, an event for longtime employees and a tribute event for outstanding employees. In order to make it easier for employees to balance the working hours and the leisure hours and their family and personal time, flexibility is instituted in the management of working times and hours. At the same time, and irrespective of the social distancing requirements during the coronavirus period, we allow the employee a weekly day of work from home at the option of the employee.
In addition, out of an awareness of the health impact of the modern lifestyle and the manner of employment, which is characterized by a lot of sitting, we encourage our employees to lead a healthy lifestyle and to join physical activity programs, such as Weight Watchers groups and the company’s running group. In order to emphasize the importance that we attach to the topic, we provide sponsorships to different races and participate in some of them, for instance, ‘Hever’ races and the Israel Cancer Association race. In addition, we encourage our employees to come to work by cycling. To this end, we have set up showers for employees at the Ayalon headquarters building.
WORK ENVIRONMENT AND TERMS OF EMPLOYMENT
Since the employees are our key growth engine, we invest a great deal of resources in establishing a pleasant and inclusive work environment that allows them to maximize their professional and personal potential. We have a responsibility to our employees to maintain a principled, safe and inclusive work environment. We believe that the physical and mental conditions in which the employees are expected to perform their duties have a material impact on their daily functioning and on their personal welfare and we are working to improve the work environment with regard to these elements.
Our relationships with our employees, the key stakeholders of the company, are founded on mutual respect, commitment and caring. Therefore, we invest a great deal of resources in increasing the organizational connectedness of the employees through a supportive work environment, and in maintaining a work-home balance that allows for a healthy work routine over time. Moreover, we treat the employees fairly and protect their rights.
We invest in human capital generously and in many aspects: Promoting a supportive, adaptive and inclusive work environment; promoting a healthy lifestyle; providing benefits and funds to employees; promoting a work-home balance; working to prevent sexual harassment and discrimination. Our constant aspiration is to create a common value with the employees, which will prompt them to feel value from their work experience at the company, just as the company receives great value from their work.
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As part of our humane concept, which regards each employee as a unique person, we guide the employees at the important crossroads in their lives. We give gifts to mark events, such as moving, birth, marriage and birth of a grandson or granddaughter. Retirement is a major crossroad where we invest a great deal of resources for the benefit of the employee’s welfare. Recognizing the enormous significance of this step in their lives, we help them face the psychological, economic and social challenges that it poses. We offer our employees a graduated retirement plan, which enables a gradual transition between the working period and the retirement itself. Moreover, we offer the employees assistance in all matters related to the financial aspects involved in retirement while taking advantage of the company’s existing professional knowledge when it comes to managing pension funds.
Moreover, we use our unique knowledge as an insurance company in order to assist all our employees in their financial conduct. Ayalon employees are entitled to free financial advice and planning, in which they receive information regarding a variety of topics: Current provisions; different insurances such as health, long-term care and life; avoiding double insurance; tax planning in the pension savings components, etc. Informed financial conduct, particularly in the complex worlds of insurance and savings, has tremendous social and personal value for the employees and their family members.
ACCESSIBLE WORK ENVIRONMENT As an organization that holds the Accessible Badge of Honor of the Access Israel Association, we see key value in making the work environment accessible to people with disabilities, so that every person can be part of the company and receive an equal opportunity to work for us. We strive to adapt the specific work environment – including office equipment and working conditions – to an employee with disabilities according to his needs in order to allow him to perform his duties in an optimal manner. Thus, for example, a screen magnification system was
installed for an employee with visual impairment. Furthermore, we make sure that there are properly functioning accessibility devices on each floor of the company’s buildings. All the accessibility arrangements are posted with full transparency on the company’s website.
SAFE WORK ENVIRONMENT We at Ayalon take very seriously our responsibility to provide employees and managers with a safe work environment that protects them and respects their personal needs. Personal safety and mutual respect, regardless of any attributing trait, are the focal point in our organizational concept.
We strive to create an egalitarian employment and work environment, adapted to all the employees from all the population groups and without discrimination based on religion, race, gender, sector, sexual orientation, disability, nationality or other attributing trait. Accordingly, in 2020 no complaint of a discriminatory incident at Ayalon was received.
When it comes to the sense of personal safety, we invest a great deal of resources in ensuring a work environment free of sexual harassments and offensive behaviors. The director of the Human Resources Department is responsible for handling the prevention of sexual harassment and complaints and she does so pursuant to the provisions of the law and the company’s procedures. We are working to instill among the employees awareness of the importance of the topic and to coordinate expectations with regard to acceptable and prohibited behaviors in a professional work environment. Within this framework, all the employees are required to undergo annual training through courseware on the subject of preventing sexual harassment. In 2020, about 86% of the employees of Ayalon Insurance Company completed the courseware studies. No sexual harassment complaints were received by the company this year.
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EMPLOYMENT OF CONTRACT WORKERS The Ayalon group employs contract workers in the fields of cleaning, catering (in the employee dining room) and information systems. In the field of cleaning and catering the number of contract workers stands at forty and in the information systems field, the number of contract workers stands at one hundred and twenty. As part of our social responsibility towards the employees, we safeguard the conditions of the contract workers and work only with licensed contractors who are known for protecting employee conditions. Therefore, in cleaning and catering unruly fields in this context we use the services of a single vendor. In order to
ensure that the employee conditions are indeed safeguarded, sample payroll audits are performed. In addition, the Bookkeeping Department is involved in examining the scope of employment of the contract workers.
We attach great importance to the connectedness of the contract workers similar to that of the company’s employees and work to promote the same in an effort to create a pleasant and respectful work environment. We make sure to have an ongoing dialogue with the contract workers, to grant annual bonuses to outstanding workers among them and to include them in the company’s events, such as the fundraising event for Shalva children. In 2020, no complaints were received from the contract workers regarding their terms of employment.
Over the course of the coronavirus crisis, we have seen great importance in creating an economic safety net for the contract workers, despite the considerable decline in the use of the company’s facilities Therefore, we implemented creative solutions in order to retain the jobs of many of the workers. For instance due to the closure of the dining room during the coronavirus period, the contract workers made food deliveries to the offices for the employees who came to work. In this manner, thirty-five of the contract workers in the cleaning and catering field retained their jobs at the company in the course of this period.
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Unpaid Leave in the Ayalon Group
Went on unpaid leave
Women Men Total
Up to age 30 41 5 46
30–50 73 13 86
Age 50 and older 21 4 25
Total 135 22 157
Returned from unpaid leave
Women Men Total
Up to age 30 30 2 32
30–50 58 11 69
Age 50 and older 14 2 16
Total 102 15 117
PROTECTING THE ENVIRONMENT AND THE EMPLOYEES DURING THE CORONAVIRUS PERIOD All of our regular routines changed substantially during the coronavirus crisis. During this period, we had to adapt ourselves to the social distancing requirements and to deal with the ramifications of the crisis on the economic situation and the personal welfare. We maintained regular contact with the employees, inter alia, in order to create functional continuity and business continuity and in order to get through the period. Moreover, we made the protection of the employees’ health and their personal welfare a top organizational priority.
Accordingly, we built a technological infrastructure that enabled connecting from home and work from home while maintaining the high level of information security that we require. We sent memos via the organizational portal, which included tips and tools for improving remote work capabilities and remote management.
Moreover, we made sure to provide support to the employees and to maintain their high level of connectedness to the organization through ongoing communication, online lectures on a variety of topics and providing tools to managers for managing employees remotely. In addition, we made sure to hold activities for the employees’ welfare, such as a cooking workshop, various competitions, fitness training, etc. Furthermore, we sent gifts to the homes of the employees and produced a remote year opening event, which was photographed by photographers from a professional studio.
With the outbreak of the coronavirus crisis, we attempted to maintain the employment continuity of most of the company’s employees, recognizing the importance of structural and economic stability during this period. Of all the employees of the Ayalon group, only 157 employees (14%) went on unpaid leave, 117 of them returned to work.
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ABOUT THIS REPORT The present report is the first corporate responsibility report that we are publishing. After years of prominent activity in the field of corporate responsibility and disclosure of information in this regard through a variety of channels, we have chosen to increase the transparency to our stakeholders and to compile the information on the activity according to the leading international standards.
The report describes the achievements of the Company, its management approach and its activities in the various aspects of our corporate responsibility in 2020. The report was written in accordance with the reporting standard of the GRI (Global Reporting Initiative) organization, the world’s leading reporting standard for non-financial reports, at a core reporting level. Furthermore, the report refers to the work framework of the UN’s development goals (SDGs, see further details below). It presents the activity in a transparent, reliable and comprehensive manner in order to give the stakeholders a holistic status report on our corporate responsibility. The bulk of the activity described refers to Ayalon Insurance Company, unless specified otherwise, due its centrality in the Group.
The quantitative data in the report is based on accepted indicators and is presented as required under the standards of the GRI organization. The information and the data were collected in the company, and they reference documents and organizational information forwarded in various ways for the purpose of formulating the report. If there is a disparity between the data reported in this document and the financial statements of the company, the financial statement takes precedence.
We invite you to contact us regarding any matter, suggestion or question pertaining to the present report and to our activity in the field of corporate responsibility in general. Please contact the Marketing and Communication Department at the e-mail address: [email protected].
MATERIAL ISSUES Material issues are topics associated with the corporate responsibility being promoted by the company, since they are important and relevant to its activity. In order for the company’s activity to have true value to the corporation, to the stakeholders, to society and to the environment, the stakeholders rank and determine the issues and the company bases its activity on the results of the materiality analysis ensuing from the ranking. Accordingly, the material issues selected are presented in this corporate responsibility report. Basing the report on the list of issues material to the company is part of the requirements of the GRI reporting standard.
As part of the writing process of the present report, we constructed a materiality matrix for the company. The matrix describes the level of materiality of the corporate responsibility issues to the company and to the stakeholders. To construct the matrix, we consulted extensively through several channels of discourse with key stakeholders of the company from different groups, such as employees, policyholders and agents. In addition, we took into account the expectations of investors and reinsurers, as these were reflected in external surveys and in disclosed information. The stakeholders we consulted expressed their opinions on the material issues and ranked them according to the preferences of the stakeholder groups they represented in the process. The level of materiality of the issues to the company was determined by management representatives of Ayalon Insurance Company and Ayalon Holdings.
The weighted level of materiality of each issue is presented in the below graph. The higher the issue appears, it reflects greater materiality to the stakeholders (with weighted prioritization of all the stakeholders). The more the issue appears on the right side of the graph, it reflects greater materiality to the Company.
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The Materiality Matrix and Issues for ReportingIm
porta
nce to
the stakeholde
rs
Importance to Ayalon
Environmental impacts of products
Employee trainingand development
Indirect economic impacts
Investment and involvement in the community
Privacy andinformation security
Work environment and terms of employment
Management employee relations
Ethics and preventionof internal corruption
Equal treatment ofdiverse populations
Reducing riskybehaviors
Managingenvironmental aspects
Responsible supplychain
Service quality
Innovation
THE ISSUES MATERIAL TO THE AYALON GROUP 1. Service quality – Promoting service
quality and maintaining customer satisfaction through training, monitoring and measurement, learning about service and improving the quality of service in practice.
2. Innovation – Promoting innovation in services and products that the group offers to its customers, with an emphasis on digitalizing channels of communication with the customers and other stakeholders.
3. Privacy and information security-Managing information security and maintaining confidentiality of customer information in parallel with responding to customer inquiries and handling the same.
4. Work environment and terms of employment Maintaining suitable, rewarding, fair and pleasant terms of employment and work environments for all the group employees in such manner that enhances the business effectiveness of the human resource at the company.
5. Investment and involvement in the community Investing the group’s time and resources in the community and employee involvement in the community, including financial and in kind donations, volunteering of employees and promotion of social goals by the group.
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9. Indirect economic impacts – The company’s total economic impacts on the economy its contribution to strengthening the GDP of the Israeli economy, to developing the periphery, etc. beginning with the contribution to employment to assistance in business activity.
10. Environmental impacts of products – Designing certain products and services so that they will positively impact the environmental behavior habits of the customers and the public, for instance car insurance based on travel volumes, a provident fund that includes only green investments, insurance for green energy facilities, etc.
11. Equal treatment for diverse populationsProviding services to diverse customers, populations and sectors in Israeli society, while adapting the services to the unique needs of the populations and in such manner that facilitates economic development in all the societal sectors.
6. Employee training and development – Professional training of the employees in the group according to the business needs of the group and for the personal and professional development of the employees, including increasing their range of personal abilities and with a view to the future professional needs of the group.
7. Management-employee relationsAssimilating effective interfaces between employees and management that facilitate proper working relations and enhance the mutual satisfaction from the working conditions, while preserving all the employee rights.
8. Maintaining ethics and preventing internal corruption Reducing the risks in the group’s activities by maintaining the integrity of its personnel. In addition, promoting business and value excellence by instilling principles of business ethics in the activity and by effectively managing compliance with all the legal and regulatory requirements applicable to the company.
12. Reducing risky behaviors – Reducing social risks resulting from a negative driving culture, poor health, criminality and business fraud. This according to our business model, which also relates to dangerous behaviors of the public and of our clientele.
13. Responsible supply chain Integrating corporate responsibility principles including environmental and social principles in the management of the group’s engagements with suppliers, in the supplier selection process and in the manner of management of an ongoing, fair and transparent relationship with them.
14. Managing environmental aspectsMinimizing the environmental impact of the group, including not using hazardous substances, recycling waste, reducing the carbon footprint and taking environmental aspects into account when making decisions with regard to the operating activity.
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APPENDICESAPPENDIX 1. GRI CONTENT INDEX
Name of the Indicator Description PageStandard
102-43 The organization's approach 16-17, 71-73to stakeholder dialogue
102-44 List of key topics raised in the dialogue 71-73and response of the organization
102-45 Entities included in the 8fnancial statements
102-46 Defning report content and 78reporting boundaries
102-47 List of material topics 71-73
102-48 Restatements of information this is the groups frst report
GRI 102: 102-49 Changes in reporting this is the groups General frst reportdisclosures 2016 102-50 Reporting period 71
102-51 Publication date of most recent report this is the groups frst report
102-52 Reporting cycle 71102-53 Contact point regarding the report 71102-54 Adjustment to GRI-SRS 71
reporting standard102-55 GRI index 74-77102-56 External assurance no external
assurance was done on this report
Name of the Indicator Description PageStandard
102-1 Name of the organization 7102-2 Activities, brands, products and 7, 13
services of the organization102-3 Location of headquarters 8
of the organization102-4 Location of operations of the organization 7102-5 Nature of ownership and form 8
of legal organization102-6 Markets that the company serves 7, 13102-7 Scale of the company 10-11102-8 Reporting on the workforce 10-11, 60-62
GRI 102: 102-9 Supply chain 36General 102-10 Signifcant changes to the none occurreddisclosures organization and its supply chain2016
102-11 Precautionary principle 17, 55-58102-12 External initiatives 12102-13 Membership of associations 8102-14 Statement from senior decision- 6
maker in the organization102-16 Values, principles, standards and 15
norms of behavior of the organization102-18 Corporate governance structure 9, 20102-40 List of stakeholders of the organization 16102- 41 Collective labor agreements 64-67102-42 Identifying and selecting stakeholders 71
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Name of the Indicator Description PageStandard
GRI 103: Management Approach 2016103-1 Explanation of the material 36-40, 67-68
topics and their boundaries103-2 The management approach 36-40, 67-68
and its components103-3 Progress of the management approach 36-40, 67-68
GRI 201: Economic Performance 2016201-1 Direct economic value generated See the
GRI 201: by the company and distributed Company’s Economic fnancial Performance statements2016 201-2 Economic implications and 36-40
other risks and opportunities resulting from climate change
201-3 Bank commitment due to 67-68employee retirement / remuneration and pension plans
201-4 Government support/grants/ The disclosure assistance received by the company is not relevant to during the reported period the company’s
operationsGRI 103: Management Approach 2016
103-1 Explanation of the material 22topics and their boundaries
103-2 The management approach 22GRI 203: and its componentsIndirect
Economic 103-3 Progress of the management approach 22Impacts 2016 GRI 203: Indirect Economic Impacts 2016
203-1 Infrastructure investments 32, 35, 40and services supported
203-2 Signifcant indirect economic impacts 30-36, 40
Name of the Indicator Description PageStandard
GRI 103: Management Approach 2016103-1 Explanation of the material 35
topics and their boundariesGRI 204: 103-2 The management approach 35Procurement and its componentsPractices 2016
103-3 Progress of the management approach 35GRI 204: Procurement Practices 2016
204-1 Proportion of spending on local suppliers 35-36GRI 103: Management Approach 2016
103-1 Explanation of the material 55topics and their boundaries
103-2 The management approach 55ad its components
GRI 205: 103-3 Progress of the management approach 55Anti-corruption GRI 205: Anti-corruption 20162016 205-1 Action taken to identify various 55-57
corruption activities205-2 Communication and training with respect 55-57
to anti-corruption policies and procedures205-3 Confrmed incidents of corruption 57
and actions takenGRI 103: Management Approach 2016
103-1 Explanation of the material 36-39GRI 301: topics and their boundariesMaterials 2016 103-2 The management approach 36-39
and its components103-3 Progress of the management approach 36-39
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Dummy TextDummy TextDummy Text
Name of the Indicator Description PageStandard
GRI 301: Materials 2016301-1 Materials used by the company, 39
measured by weight or volume301-2 Percentage of materials used by the 39
GRI 301: company that are recycled materialsMaterials 2016 301-3 Reclaimed products and their The disclosure
packaging materials is not relevant to the company's operations
GRI 103: Management Approach 2016103-1 Explanation of the material 36-38
topics and their boundaries103-2 The management approach 36-38
and its components103-3 Progress of the management approach 36-38
GRI 302: Energy 2016302-1 Energy consumption within 38
the organizationGRI 302: 302-2 Energy consumption outside The disclosure Energy 2016 of the organization is not relevant
to the company's operations
302-3 Energy consumption intensity 38within the organization
302-4 Reduction of energy consumption 38within the organization
302-5 Reduction of energy consumption 38through the products or services of the organization
Name of the Indicator Description PageStandard
GRI 103: Management Approach 2016103-1 Explanation of the material 36-39
topics and their boundaries103-2 The management approach 36-39
and its components103-3 Progress of the management approach 36-39
GRI 305: Emissions 2016305-1 Direct greenhouse gas 39
emissions (Scope 1)305-2 Indirect greenhouse gas 39
emissions (Scope 2)305-3 Other indirect greenhouse The disclosure
gas emissions (Scope 3) is not relevant GRI 305: to the Emissions company's 2016 operations305-4 Intensity of greenhouse gas 39
emissions of the organization305-5 Reduction of greenhouse gas emissions 38305-6 Emissions of ozone-depleting substances The disclosure
is not relevant to the company's operations
305-7 Other signifcant air emissions The disclosure is not relevant to the company's operations
GRI 103: Management Approach 2016103-1 Explanation of the material 60
GRI 401: topics and their boundariesEmployment
103-2 The management approach 602016and its components
103-3 Progress of the management approach 60
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Dummy TextDummy Text
Name of the Indicator Description PageStandard
GRI 401: Employment 2016401-1 New employee hires and 63
GRI 401: employee turnoverEmployment 401-2 Benefts provided to full-time 67-682016 employees that are not provided to
temporary or part-time employees401-3 Parental leave 60
GRI 103: Management Approach 2016103-1 Explanation of the material 63-64
topics and their boundariesGRI 402: Labor/ 103-2 The management approach 63-64Management and its componentsRelations 2016 103-3 Progress of the management approach 63-64
GRI 402: Labor/Management Relations 2016402-1 Minimum advance notice period 63-64
for organizational changesGRI 103: Management Approach 2016
103-1 Explanation of the material 65-66topics and their boundaries
103-2 The management approach 65-66and its components
GRI 404: 103-3 Progress of the management approach 65-66Training and GRI 404: Training and Education 2016Education 404-1 Average hours of training 652016 per year per employee
404-2 Programs for upgrading employee skills 65-66and transition assistance programs
404-3 Percentage of employees receiving 66regular performance and career development feedback
Name of the Indicator Description PageStandard
GRI 103: Management Approach 2016103-1 Explanation of the material 51, 67-68
topics and their boundariesGRI 406: 103-2 The management approach 51, 67-68Non- and its componentsdiscrimination
103-3 Progress of the management approach 51, 67-682016GRI 406: Non-discrimination 2016
406-1 Number of incidents of discrimination 51, 67-68and corrective actions taken
GRI 103: Management Approach 2016103-1 Explanation of the material 22-27, 30-31
topics and their boundaries103-2 The management approach 22-27, 30-31
GRI 413: Local and its componentsCommunities
103-3 Progress of the management approach 22-27, 30-312016GRI 413: Local Communities 2016
413-1 Operations with local community 22-27, 30-31engagement, local community impact assessments and development programs
GRI 103: Management Approach 2016103-1 Explanation of the material 57-58
topics and their boundaries103-2 The management approach 57-58
GRI 418: and its componentsCustomer
103-3 Progress of the management approach 57-58Privacy 2016GRI 418: Customer Privacy 2016
418-1 Substantiated complaints concerning 58breaches of customer privacy and losses of customer data
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APPENDIX 2: REPORTING BOUNDARIES AND MATERIAL ISSUES
Reporting Topic Reporting Relevant Sections in ReportBoundaries
Service quality Within the Quality and humane serviceorganization Innovation
At the service of the agents
Innovation Within the Innovationorganization Quality and humane service
Privacy and information Within the Privacy and information security organization security
Work environment and Within the Work environment and terms of employment organization terms of employment
Management – Within the Culture of openness employee relations organization and partnership
Investment and involvement Within the Increasing social resiliencein the community organization
Employee training Within the Employee training and development organization and development
Ethics and anti-corruption Within the Fairness in serviceorganization Ethics and principled
management
Indirect economic impacts Within and outside Increasing social resiliencethe organization Investing in the Israeli economy
Environmental impacts Within and outside Protecting the environmentof products the organization Investing in the Israeli economy
Reporting Topic Reporting Relevant Sections in ReportBoundaries
Equal treatment for Within and outside Innovationdiverse populations the organization Quality and humane service
Fairness in service
Work environment and terms of employment
Ethics and principled management
Increasing social resilience
Reducing risky behaviors Within and outside Increasing social resiliencethe organization Investing in the Israeli economy
Regulatory compliance Within the Ethics and principled organization management
Responsible supply chain Within the Responsible supply chainorganization Work environment and
terms of employment
Managing environmental Within the Protecting the environmentaspects organization
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