The pandemic has put people risk at the top of the corporate agenda and given risk managers a further opportunity to reach out to HR to bring their risk financing and wider skills to bear, according to speakers at our latest event, who urged risk professionals to get involved.
The move into HR risk is a relatively new phenomenon for risk managers, but collaboration between the two functions can be hugely beneficial for organisations, experts agreed at Commercial Risk’s two-day virtual employee benefit conference, sponsored by Zurich and Allianz.
“Covid-19 made it clear to boards and executives that health is on top of the agenda. So there is no more room to pretend otherwise. One of the benefits of the pandemic is it has highlighted again the importance of taking care of the health of our employees and their families,” said Franck Baron, chairman of pan-Asian risk management association Parima.
“Risk management can help tremendously with this agenda. The risk financing aspect is important and there is lot to be said about the use of captives and the advantages of structuring global programmes to help with this risk. But as mentioned by several of our panellists, the ability to develop preventative programmes is a big opportunity,” added Baron, who is also group deputy director of risk management and insurance at International SOS.
He and others speakers at the event encouraged risk managers to knock on the doors of their HR colleagues and start conversations if they haven’t already done so.
Baron believes this is a critical development for risk managers. “Covid-19 highlighted the prime importance in managing health-related risks. Health risks are part of risk management, so it is up to risk managers to be part of this conversation,” he said.
Parima’s chair said the good news is there is growing dialogue between risk managers and HR within companies, and then with the insurance industry and advisers to help manage employee benefit and people risk.
Fellow speaker Stephen Ratcliffe, a partner in Baker & McKenzie’s employment practice, said in his experience risk management’s involvement in discussions on workforce strategy varies greatly between organisations. But he too believes risk managers have a big role to play in the strategy design phase and particularly as many organisations renew their approach to flexible working in light of the Covid crisis.
“We have conversations where decisions on the way in which you shape your workforce are led primarily by HR and that is entirely reasonable given the right workforce. But there is a regulatory overlay that I think requires a degree of oversight, at the very least at the design phase when you are thinking about flexible working options. I am not saying risk managers have to be involved in every single decision about whether every single employee can move to four days from five days, but at the design phase I think their involvement is very, very important,” he told delegates.
Giovanni di Meo, regional director for Asia-Pacific at Allianz Global Benefits, agreed that risk managers have a big role to play in people risk management, and can offer their vast knowledge on risk transfer options.
He believes the pandemic has clearly shown that employee benefits managed under a multinational programme offer clear advantages when it comes to flexibility and efficiency.
“The first advantage of a multinational programme is the global coordination and access to a network that is offered by an account management team. Someone at a global level that is supporting the client in each country with a specific need, connecting the local insurers and understanding the local regulations can really be a game-changer for clients at international level, and also for each and every market a company operates in,” said di Meo.
Like Baron, he also stressed the role captives can play with employee benefits and people risk. Their value in this area was clearly demonstrated during the pandemic, added di Meo.
“It is very important to mention the captive case. Captives are really one of the best solutions to achieve flexibility and efficiency. I think during the pandemic we have seen how the captives have helped clients to act very fast when they had to waive specific exclusions or provide benefit uplifts,” he said.
The two-day event is supported by Brokerslink, the International Employee Benefits Association and Uniba Partners. It runs from 20-21 October and you can register for day two here.