Other parts of this series:
International Women’s Day, celebrated on 8 March, is an opportunity to imagine a world that is more gender diverse, equitable and inclusive. The latest statistics suggest the insurance industry is making progress, having already reached a balanced workforce in some countries [¹]. However, women are still advancing less than men to decision-making positions. I believe this is a perennial issue that we need to examine and address. It is well documented that advancing women to leadership roles can help organizations to be more innovative and higher performing. In this series, I will provide a snapshot of female leadership representation in the insurance industry in Europe and speak to the female leaders redefining the status quo.
Female leadership representation in insurance – where Europe stands
In its latest Gender Diversity Index report, European Women on Boards (EWOB), a not-for-profit consortium of organizations advocating for gender balance on corporate boards and firms’ top management in Europe, ranked financial services and insurance as second among the sectors represented. However, the study finds that the divergence between sectors is not as significant as that between countries, illustrating that the issue of gender equality in leadership is more affected by cultural and idiosyncratic reasons than by the features of an economic sector alone.
In its February 2021 study, Swiss Reshows that although the insurance industry has made progress in the last decade, women are still significantly under-represented in executive positions. Based on a sample of about 400 insurers and 29 reinsurance companies from the world’s 12 largest insurance markets accounting for 71% of the global insurance premiums, the study found that women only made up about a quarter of (re)insurance companies’ executive roles, 10% of CEOs, and 8% of board members globally. [2]
Country-wise, the study shows that advanced markets tend to have more gender-diverse C-suites, with an average of 30% women in C-level executive positions, compared to 13% in emerging markets. In Europe, France had the highest ratio of women in executive positions, with 41% – also topping the global ranking, followed by Italy (26%), the UK (24%), and Germany (19%). These figures are significantly lower when considering the share of women as CEO or as board chairpersons.
The study also found that the share of women in executive positions is still far lower than women’s share in the overall industry sector workforce.
Creating a culture of gender equality
Accenture’s When she rises, we all rise report in 2018 identified 40 personal and cultural factors that are statistically important to influence women’s advancement in the workplace, spanning conditions promoting a diverse leadership team that sets, shares and measures equality targets openly (Leadership); policies and practices that are family-friendly, support both genders and are bias-free in attracting and retaining people (Action); and an environment that trusts employees, respects individuals and offers freedom to be creative and to train and work flexibly (Empowerment). The research found that in organizations where these factors are more commonly found, women are 35% more likely to advance to manager level and beyond, and almost four times more likely to advance to senior manager/director level and beyond. The presence of these factors was also found to be significant in narrowing the pay gap.
Gender equality impacts performance
Giving women equal opportunities is a matter of principle but is also an intelligent strategic play. Research shows that creating a diverse workplace environment can make organizations more innovative and higher performing.
The Swiss Re research found that a higher ratio of women in leadership positions in (re)insurance companies correlates with higher company profitability. The data in the study showed that (re)insurers with the highest share of women as executives or board members outperformed those with the lowest share of leaders by 3-4 percentage points in ROE. This finding was in line with other financial services sectors and with previous studies showing that gender diversity is also positively correlated with both profitability and value creation. Through Swiss Re’s panel data regression analysis, the study also found that a 10% increase in the share of women on the C-suite or board is associated with 1-2 percentage points higher ROE performance than the industry average and that adding at least one woman to an all-man C-suite or board is associated with a 3-5 percentage point increase in ROE above the industry average.
Accenture’s Equality = Innovation report in 2019 also found that a culture of equality is a powerful multiplier of innovation and growth. The research showed that employees’ innovation mindset is six times higher in the most equal cultures than in the least equal ones. Indeed, for every 10% improvement in cultural factors, the innovation mindset increases by 10.6%. This change is underpinned by all culture-of-equality pillars, but the empowerment factors are the ones with the strongest impact. Accenture’s The Hidden Value of Culture Makers research from 2020 also found that those organizations that are more committed to building more equal cultures report their sales are two times higher and their profits are three times higher than those that are behind the curve.
Culture starts with leadership
Accenture’s 2018 research found that there are almost three times more women on the fast track – women who typically reach manager level within five years and lead their female peer group in terms of advancement in the workplace – in organizations with at least one female senior leader (23%) than in organizations in which all senior leaders are male (8%). Additionally, the study found women are able to advance into leadership positions faster in organizations where leadership factors are more common.
However, there is still a gap between what the C-suite and employers think about the work environment in their firms versus the perception of employees. Accenture’s 2020 study found that while two-thirds of leaders (68%) feel they create empowering environments—in which employees can be themselves, raise concerns and innovate without fear of failure— just one-third (36%) of employees agree. Other studies have shown that feeling more included can boost productivity while having the ambition to reach leadership is important to advancing in an organization. [³]
European leaders need to target perception gaps and create environments in which women are supported in pursuing leadership roles.
In conclusion
While some insurers in Europe are taking steps to address gender inequality in top leadership, there are still areas where female representation needs to be driven. In this series, I will look into insights from female insurance leaders and explore how the insurance industry needs to move forward to support women in advancing in their professional careers within insurance.
