And they also agree this is just one reason why Markel has been focused on D&I for years.
“Being a diverse and inclusive organization is critical for Markel to reach our short- and long-term goals,” explained Peterson. “We’re committed to continuing our tradition of high integrity and long-term success, and in 2022 that requires having the best talent, which means diversity and inclusion. Studies have repeatedly shown that companies perform better when they have diversity in all key organizational segments, including their boards of directors, senior leadership teams and employees.”
Our business is complicated, and the more people that we have at the table who have very different perspectives, the better.
According to the most recent report in a series by McKinsey, “Diversity wins: How inclusion matters,” companies with a more diverse workforce are more likely to perform better and be more profitable. The survey drew insights from more than 1,000 companies in fifteen countries, with 22% of respondents from the finance, insurance and professional services sector.
“Companies in the top quartile for gender diversity in executive teams are 25% more likely to have above-average performance results,” Peterson notes. “Additionally, companies that are in the top quartile for ethnic and cultural diversity on their executive teams are 33% more likely to have industry-leading profitability.”
Davies highlighted the progress Markel is making in this area. “We’ve managed to increase the number of new hires who identify as an ethnic minority by 50% over the last three years,” she noted. “We have also seen a slight increase in females at senior levels in the organization. There is clearly more work to do in that space across the insurance industry, but that's something that we've really been focused on.”
Attracting Diverse Talent
While McKinsey’s report found the business world’s overall progress has been slow—for instance, female representation on executive teams rose from 15% in 2014 to 20% in 2019—it’s evident that many companies are taking steps to become more inclusive. For Markel, the need to adapt is more paramount than ever.
“Our business is complicated, and the more people that we have at the table who have very different perspectives, the better,” Peterson said. “Demographics are changing, and if we’re not adapting as an organization to those changes, we’re not going to be able to meet the needs of our clients. Understanding and anticipating our customers’ needs is a big part of our culture, and an inclusive and diverse team helps us achieve that goal.”
She added: “We’re a specialty carrier, playing in some very distinct niches, from personal lines insuring high-end bicycles up to our commercial teams providing D&O and liability insurance for Fortune 100 companies. So there’s a lot of space in there, and having a diverse workforce allows us to be innovative and win in our target classes. We are building new relationships all the time, for example with minority-owned agencies that we might not have identified if it weren’t for our diverse workforce. Those new relationships are exciting to us, and are great inroads into expanding our business.”
We’re seeing that the diversity of our employees allows us to have an innovative approach, a creativity, that helps us compete and go after the kind of new business and profitable growth that we're looking for.
As the insurance industry faces a shortage of talent overall, a top priority is attracting and retaining diverse talent. “There’s a major talent war going on, and we believe our D&I strategy helps make us more attractive,” Peterson said. “It also helps us secure the benefit of hiring from a more diverse spectrum of schools and students.”
“In the first nine months of 2021, we brought in around 800 new employees, as many as we hired in all of 2019, the last pre-COVID year,” Davies noted. “To keep up with the growth of our business, it's important to be able to create a compelling employee value proposition that emphasizes diversity.”
In 2019, Markel created a D&I steering committee to drive its D&I strategy and improve employee development. Peterson and Davies serve on the committee along with more than a dozen other senior colleagues.
“The objective of the committee’s three-year strategy for D&I was to drive, advocate and champion the D&I strategy we’ve laid out,” Davies said. “The strategy ties in very closely with the Markel Style, which is a timeless statement of our values and culture that was actually put together back in 1986, and emphasizes helping individuals reach their personal potential."
Thinking Outside the Box
As the insurance industry continues to find new ways to attract diverse talent, it’s also exploring new ways to develop talent from diverse backgrounds.
“One of the things we felt was very important was to understand diversity from a global perspective, because ethnicity classifications vary greatly depending on where you live,” Davies said. “We accordingly worked on building some common definitions and metrics to track performance globally and to build awareness among our employees across the world. We looked at everything from training programmes to onboarding, performance management systems, and making sure D&I is integrated across the whole business.” The organization also supported the launch of employee resource groups (ERGs) to create a platform for colleagues to engage and deliver on a broad set of deliverables supporting Markel’s D&I objectives.
Peterson added: “In terms of tangible benefits, we’ve put a lot of thought into the metrics that will show us how we’re performing. Pulse surveys of staff show that the strategy has gone down well. We also have a D&I index that shows the reaction to our policies internally.”
Over the next three years, the committee will build on this strategy in three important focus areas: the workforce, including an updated early career strategy; the workplace, through emphasizing the role of leaders and managers; and the marketplace, through a focus on business development and supplier diversity.
According to Davies, fostering a more diverse and inclusive environment is positively impacting Markel’s business.
“We’re seeing that the diversity of our employees allows us to have an innovative approach, a creativity, that helps us compete and go after the kind of new business and profitable growth that we're looking for," said Davies. "So there’s no doubt we're seeing a really positive impact."
