Do DEI champions have what they need to succeed?

Diversity, equity and inclusion (DEI) policies should be mission-critical for insurance organizations, but our latest DEI survey shows efforts to boost inclusion within Canada’s P&C insurance broker community are losing steam.

For brokerages actively pursuing DEI initiatives, there is no one road to success, experts tell a recent Canadian Underwriter LinkedIn livestream panel discussion.

Fully 75% of brokers answering CU’s 2024 Brokerage DEI Survey say their organizations must address diversity to ensure business success.

That’s a large majority, but that total’s trending down from prior years – 91% surveyed in 2022 called DEI mission-critical, while 84% said so in 2023. Now in its third year, 2024’s survey received 291 responses and was made possible with the support of Sovereign Insurance.

Hiring practices might be partly responsible for this loss of momentum.

“Many companies even hired DEI executives on their boards and made them very senior leaders,” says Dorothy Aarons, senior vice president and senior account executive at Aon’s risk management practice. “A lot of those [people’s] roles no longer exist.

“We have to have a commitment to DEI [from the organization’s leadership]. It has to be genuine. And the company needs to understand why they’re doing it. It’s not just a business imperative, it’s also a moral imperative — it is the right thing to do.”

Despite signs of flagging commitment, most brokers remain in the DEI camp and top-cited threats to ignoring diversity include losing access to talent (35%), losing good employees (30%), and a lack of diverse perspectives and strong teams (30%).

And many say promoting DEI best practices at Canadian P&C brokerages is about the journey, not the destination.

Passive versus purpose

Some companies lack the resources to create formal DEI committees but still stress that simply fostering an inclusive environment can make an impact.

“We don’t have a DEI policy, we don’t [have the] manpower to form a committee. However, that doesn’t mean that we are not talking about it,” says Jennifer Lau, director of broker development at BrokerTeam Insurance Solutions Ltd. during CU’s live panel.

“Here in our office, even in our entire umbrella, we’re very, very diverse,” says Lau, who’s also president of the Canadian Chinese Insurance Professionals Association.

The source of organic diversity, the panellists say, comes from leaders who set the tone. When leaders commit to DEI, it affects the company’s culture and influences policies — even if subtly. And the survey data supports this conclusion.

Respondents from P&C brokerages with diverse leadership are far more likely to view DEI as a fundamental value that guides decision-making (17%), or as a strategic imperative critical to success (64%), compared to organizations with little or no diversity in leadership (8% and 28%, respectively).

“If you ensure leadership is committed to DEI initiatives and leads by example, strong and visible support from the top can create a culture of inclusion within the organization,” Lau says.

Adds Williams, “You really have to work with your team to make sure you’re implementing the right strategies for your demographics, because each brokerage is different.”

Overall, our research shows most brokerages run lean when it comes to DEI budgets.

Only two-in-ten (20%) broker respondents believe there is a budget allocation for DEI at their firms, and almost one-half (45%) are not sure. Those working in brokerages with no diversity within senior leadership are more likely to say there is no DEI budget (48%).

So, although DEI is thought to be a key priority, budgeting for it is not, says Matthew Campbell, vice president of finance, claims and strategy at Sovereign Insurance.

“There’s still a way to do it without having huge budgets and whatnot, especially if you’re a smaller organization,” he says. “Because when you rally some employees around something, it’s amazing the mountains they can move and what they can achieve.”

This article is excerpted from one appearing in the August-September 2024 print edition of Canadian Underwriter. Feature image courtesy of iStock.com/barsrsind