Ethical values are great. I’m a big fan of them for obvious reasons, but equally, a big critic when they deliver little more than a ‘feel good’ factor. Take integrity – insurers in the UK will soon have to assemble evidence that their senior managers understand what integrity means and how it should influence the decisions they make.
For many insurers, this will put them onto a steep learning curve. While integrity is one of the most popular ethical values amongst insurers, it’s also one that they’ve tended to do little with. They’ve relied upon the assumption that because their firm is full of good people, they will naturally know what ‘integrity’ is and how to do it.
That’s a dangerous assumption, for as I’ve said before, most misconduct in corporate settings is not down to bad people doing bad things, but down to good people making bad decisions. A greater, more practical understanding of what integrity means, and how it should influence decisions, would reduce such bad decisions by a large margin.
It’s at this point that firms often grumble about the lack of clear guidance from the regulator. “Why can’t someone just tell us what to do?!” is the refrain. The response they get is one they’re clearly not liking: “work it out for yourself.”
Insurers could of course bring someone in to run some in-house courses on integrity. That would however have little long term impact, for integrity is something that needs to be learnt through means other than being just being taught.
Insurance people need to learn how to ask themselves questions about what integrity means to them. This could be in terms of the role they undertake, in terms of the team they work with and in terms of the objectives set for them by their firm. The obvious format of course for asking such questions is an integrity workshop.
And in addressing questions like these, people will open the box of their experiences, personal values and professional aspirations, and start to express what they see as representing integrity, and the extent to which they have been prepared (and will in future be further prepared) to act upon it.
At the same time, the firm needs to weigh up what an ethical value like integrity actually means in practice within an insurance setting. And it should look for evidence of it actually having made an impact. This is not something that firms generally do. I have my doubts that many senior insurance managers could talk for ‘just a minute’ on what exactly integrity means to their firm and what they’ve done about it. Yet the regulator is expecting them to know all about it by the end of next year.
So integrity needs to be understood at the level of both the individual and the firm. What the firm then needs to do, and do with some involvement of non-executive directors, is work out the depth and shape of the gap between what individual people in the firm see as ‘behaving with integrity’, and what the firm expects from them on integrity in overall terms. This will then tell the board whether their firm is doing enough to encourage the type of ethical culture that allows integrity to thrive.
The times are changing for integrity. More is being demanded of this most favoured corporate value and firms need to map out their route to delivering on those demands.
Duncan is the founder of the Ethics and Insurance blog and the author of its many posts. He's a Chartered Insurance Practitioner, having worked 18 years in the UK market. As an adviser to many firms on ethics issues, as well as a regular conference speaker, he is one of the leading voices on ethics and insurance.