Stakeholders in the insurance sector have called on directors of insurance companies to carry out their business operations through digital means if they want to be relevant in today’s business world.
The Chief Executive Officer, Future Software Resources Limited, Nkemdilim Uwaje Begho, said this while delivering a paper entitled: ‘Insurance Business in Uncertain Time: The Corporate Governance Perspective’ at the 2021 Insurance Directors’ Conference organised by the College of Insurance and Financial Management (CIFM) and National Insurance Commission (NAICOM) in Lagos.
She noted that the need for digital-savvy directors on companies boards had become necessary owing to the fact that boards with three or more digitally savvy directors had 17 per cent higher profit margins than those with two or fewer, 38 per cent higher revenue growth, 34 per cent higher return on assets, and 34 per cent higher market cap growth.
She urged insurers to model corporate governance in line with local compliance as required by the regulator as well as in line with the International Corporate Governance Network (ICGN) global governance principles which describe the responsibilities of boards and shareholders respectively and aim to enhance dialogue between the two parties.
She said the to survive in uncertain times, insurers should ensure make scenario planning is key; embrace the digital age; react swiftly to policy change and regulatory intervention; take into account multiple stakeholder interests sustain continuous learning at the board and organisational level.
She noted that in embracing uncertainty organisational agility is key, while long term planning is becoming obsolete → strategies need to be tracked and reviewed in real-time.
Continuing, she tasked insurers to identify the most salient uncertainties for the industry and business & define organisational risk appetite; stress test different scenarios: weigh enterprise risk and opportunity in relation to both the stress of the situation today and the different ways industries and organisational positions might be reshaped in the new normal; boards must support management → need for constant communication and higher levels of engagement; focus on data-driven and scenario-based decision-making and real-time tracking and monitoring of economy & industry.