The Power of Data Podcast
Episode 7: The Importance of Having a Good Mentor
Guest: Sue Langley, Non-Executive Chairman at Gallagher UK, Lead Non-Executive Director for the Home Office.
Interviewer: Sam Tidswell-Norrish, International CMO Dun & Bradstreet
Welcome back. I'm joined today by Sue Langley. Welcome, Sue.
I'm going to keep it simple and describe your professional career currently in two ways as non-Exec Chair of Arthur Gallagher, and as a non-Executive for the Home Office, but you do many things. Let's start there.
I do indeed I have five roles. So those are the two key ones, but I'm also the Senior Independent Director for UKAR which is the old Northern Rock and Bradford and Bingley, a Trustee for Macmillan. And recently when a year ago elected as Alderwoman for the Ward of Aldgate.
I know a little bit about the City of London Corporation and its slightly odd quirks, but for our listeners, can you just demystify the City of London Corporation a fraction?
Probably not to be honest! I'll give it a go, so the City of London Corporation essentially provides the Council and business services for the City. And it's divided into 25 Wards, of which there are a number of Councillors elected just like a local council, and each Ward also has an Alderman, or now an Alderwoman. And from those 25 Aldermen the Chair of London and the Lord Mayor is elected.
There we go, so succinct. I'm going to transcribe that and send it over the City of London.
Let's talk a little bit about insurance because same way we saw in financial services, and in banking, 2008 happened, there was an inflection point and the industry collided with technology at a crazy pace. We haven't had that inflection point necessarily in the insurance industry, although there have been some big losses. But how is technology affecting the sector? What opportunities is it providing both across propositions for the consumers and the clients, to distribution methods? And how is regulation affecting it? Basically, can you just unpack the entire innovation landscape of insurance?
In a minute? Yeah, I think you're completely right to point out it's been a lot slower than in the banking industry. So insurance perhaps you’re seeing as a slightly more conservative or traditional industry, especially the wholesale market, so the risks such as energy catastrophe, and the personal lines insurance, so the home insurance, motor insurance, were the early adopters. And in fact Hiscox, one of my previous roles, were the first to roll out an online, high net worth insurance product.
I think it's accelerated, though in the last couple of years. One of the challenges for the insurance industry is they are sometimes fond of reiterating the current product rather than innovating in a completely new way. But you will have seen the Lloyd's plan that was issued a few months ago. And that's fairly radical in terms of opening up the market, access, distribution. So I think it's increasing but I think in insurance, it could go faster. So benefits for clients, as in any industry, it's faster access, lower cost, more choice.
Let's talk about the more conservative side of the industry. And that's a really polite way of putting it I think. It's an industry that’s always been relationship-based. A lot of deals have been done in restaurants. But it's also an industry that hasn't had a huge amount of diversity. Now I know that you've been a big champion for diversity and others, like Inga Beale, have done great work and trying to ensure that diversity across the board of age, gender, ethnicity, and ultimately of thought permeates the industry. How have you seen that shift in your career?
You're right, I think there are pockets of insurance and then a more traditional, so I'm going to point to the wholesale market, the kind of Lloyds trading market, whilst the retail insurance is perhaps more modern.
If you actually look at the stats, I think below the age of 40. Diversity for gender, for example, is almost 50/50. But we tend to lose women. We have this issue in Gallagher’s. It's called the missing middle; women drop out and they don't come back. And that's been common in the banking industry as well, and it used to be common in legal, and a lot of the issue is around if, for example, a woman drops out to have kids and comes back later, how do you protect their client base or their relationships, the people they actually deal with? Because they're distributed to other people during the time away. Well, the legal industry has solved that in terms of how they manage clients, how they explain where their account manager has gone and how they reintroduce when they come back.
So I think that is changing. I think there's a real focus on it now, absolutely a focus on it in the last couple of years in Gallagher's, but it's not a one size fits all solution, which is why it's actually quite slow to change.
I think if I could say something more than that one size fits all. I think when you look at diversity, I think quite a few companies, and this is not just insurance, try and ensure they treat people equitably, they put a template in place to treat everybody in the same way. The trouble is personally, I think everybody is an individual and sometimes you've had unintended consequences of that because you are looking for everybody to progress and to be in the same shape. And of course, we're all completely different. So I think equality and templates are great. But a company has to have the flexibility and the courage to also treat people as individuals, because what's important to me is not necessarily what's important to you. So to promote people to get them to stay, I think there has to be a fairly individual approach.
You've been championing diversity in insurance, which is critical in my mind, and equally as an Alderwoman in the City London Corporation, which does mimic the insurance template a little bit. And one of your previous roles actually was at the Department for International Trade. You were the CEO of Financial Services if I remember correctly. Can you talk a little bit about your experiences there?
I think government are actually ahead of the game in terms of diversity and difference of thought, because they've been focusing on this for a number of years. I think it's the private sector that's taking a little longer to be honest to catch up. So DIT was a fascinating role, a real diverse set of individuals. Perhaps some of the preconceptions you have about governments, I think were completely allayed, I think within my first couple of months. So I think the focus on investment and trade the government has is brilliant, but it's about how they connect properly to the private sector and to industry. Because quite often, the private sector and industry don't see the value they add, and they're not quite sure about how they should interact with them. But also in my time in government, you know, you've mentioned I was on the Women's Business Council, but most of the speaking I do is actually on social mobility. Because as an East-Ender, I was the first person our school ever sent to uni. I've been incredibly lucky in my career, only ever applied for my first job. So anything I can do, I have normally around 17 mentorees at any one time. But anyone I can help, move in because I think if you like that's the next fight, when you look at who moves through into management and directors, I realized that I am perhaps, unfortunately, slightly unusual because I've been very lucky.
You think that's still the case?
Sadly, I do. And I think it comes back to life choices. I think it's back to getting to kids in schools and making them aware of the career paths that they could potentially have. Or perhaps taking away that fear factor or belief that they can't do something. I was actually trying to persuade the lovely lady today to stand for election in the Corporation. She said to me, ‘I'm not bright enough’. This is a senior, brilliant woman in the City. I said, ‘don’t be ridiculous, why would you say that?’, you know, because I think we self-limit ourselves sometimes. And it comes from the school, I was very lucky to have a dad who told me anything was possible. So I just sail through life thinking, well anything is possible, but not everyone is that lucky.
Yeah. Whether you believe you can or you can't, you will always be right.
And actually reflecting on some of the City London Corporation’s work, I went and spoke at one of the Academies about a year ago, and it was incredible. I've couldn't help but feel like if the City of London Academy program could expand its reach, we’d benefit hugely from that. It's an amazing initiative.
I think it's one of the things… that the City doesn't really fully understand what the Corporation does. You know, I summarized it in 30 seconds, but obviously they do far more than that. They give away millions to charity, they have the Academy scheme. And it's just not well known. I don't think, until I was elected and decided to stand as Alderwoman, I'd worked with the Corporation for years on the other side, when I was at DIT, I worked with the Corporation, and I still didn't fully understand what it did. And so I actually became part of it.
Very cool. We're going to swing back to insurance. And I want to ask you a little bit about Gallagher’s itself. You've completed several acquisitions in the last few years; what's your growth strategy? How are Gallagher’s preparing for the next generation of insurance?
We had a period of consolidation for a few years, and we’ve now started M&A again. I mean, the strategic intent, to be honest, is similar to many companies. So we are looking for what we call bolt-ons, that are strategic fit, especially in the regional business. We have a lot of regional offices that complement the products that we currently write, or actually fill a gap. So we are making a number of smaller acquisitions to actually grow. The focus at the moment is on retail. Wholesale is a harder business in terms of M&A more often. You will see that we took the aerospace book from Marsh, well the US aerospace book from Marsh recently. And it's that kind of acquisition, whilst obviously on the retail side, we are looking for small regional brokers that we can actually bring into the Gallagher fold.
So we're talking about investing, almost every insurance firm out there is investing in its technology and its infrastructure. And the ultimate thing that underpins that in a world built exclusively really for risk management, is data. How are Gallagher’s approaching data management and is it a core part of your strategy?
It's really interesting area for us and it absolutely is and has been for I would say a few years but it's had a real push in the last year because a lot of the focus for Gallagher was on integrating all of the acquisitions that they're taking on a fairly quickly basis. So it’s building a sound platform and then moving on from that with M&A and intensive development. So data for us is key. And I think if you look at the insurance industry in general, and I am generalizing, I think insurance is good at managing data to understand internal business dynamics and the book of business, but is not so good, and there have been a few attempts, at using data to help the customer with risk management. So that's the focus now and that's a real priority for Gallagher's. What can we do to help manage the risk for the customer and make them understand where their portfolio products or the cover that they want actually fits globally, and what similar industries are doing.
I had a conversation earlier, a fascinating one, and I won't give too much away because it's only a young company. But taking Dun & Bradstreet’s proprietary reference ID called the D-U-N-S number that 87% of Fortune 500 firms use as their internal standard and many insurance firms around the world, and leveraging that linkage to apply it to organizations in buildings. Aggregating their credit ratings, and then basically bundling a credit rating for a building, with alerts applied to it, and so on. So that, you know, if one of your tenants undergoes some sort of liquidity event or are bought by private equity, there may be a consolidation strategy so they’ll be pulled out so the credit rating then dips for the building. And it's that kind of application of data to real world examples that we're just not seeing yet. And it's a been a slow take up, I think, not just by the insurance industry, but by every industry.
I think you're right. And if we look back at FinTech, for example, most of the new innovations came from small startups that were then acquired by the bigger banks, and it's probably the same in insurance. If you are an established traditional insurance company, I'm not saying you can't innovate, but you know what it's like it's more difficult to innovate inside of one of those companies. It’s easier to bubble out, set up a small company on the side, design something, bring it back in, or to go with the tech startups and actually to bring one of those in or use those products. But it's back to your earlier question. I think you're right, that kind of innovative use of data has a slow take up across FS, but probably slower in insurance because of its traditional nature. But I do think that's changing.
Yes, it we were in New York earlier this week. And I'm reflecting on another quote from Henry Ford, this time to Bill Gates, who when he talks about innovation talks about an underwhelming rate of change over two years, but then we end up under estimating the rate of change over 10 years. And I think that's been particularly true, potentially, in insurance with things like data, with distributed ledger technologies, and a relatively slow take up, but I am very, very excited about the next 10 years in this industry. I think there's going to be some really cool stuff happening.
Let's talk about data and how we can use it for social good and for things like diversity and social inclusion. Data can help provide transparency, which is critical in the world that we operate in. Recently, there was a publication of information via the Gender Pay Gap Report, and it talks about what businesses need to do to focus on reducing the gender pay gap. How are Gallagher's and some of the other organizations you're working within using that data I guess, ultimately, to benefit the employees and to create a much fairer ESG policies?
The gender pay gap reporting came out of the Women's Business Council, she obviously I was on for six years. And I am a huge fan of transparency, because, another quote, “what gets measured gets done”. And I know there was a lot of pushback across industry around pay gap reporting, and there are lots of reasons why I'm behind that why it's difficult to explain what's behind a single hard figure. But I think it's focused the mind. It’s started a debate in a conversation that wasn't there before. I think it's flushed through some standard, what I think to be honest across FS were excuses. You know women drop out and don't want to come back or whatever. Because it's forced companies to actually look at the reasons behind that.
So Gallagher's have done an awful lot on diversity for years and have recently run a campaign around ‘This Is Me’, so you know, what is the difference between people? And I think there are a few factors under there. So one, for example, in the wholesale markets, a thing that we've spoken about earlier, which is that if women take time out to have kids, and they've lost their client or relationship base, how do they come back in at a senior level? How do you maintain that client base? And there are things you know, the legal industry has essentially fixed that, but there are quite a few more subtle things.
If I look at my mentorees, most of which, to be honest, are female, they look at the senior roles and basically say, ‘Well, I don't want to do that’ because they look at the way that a role is done. And quite often it is very long hours, it might be out in evening, but my point to them is you can do the role standing on your head and painted orange. All you have to do is achieve the objectives. I think until we actually get different role models and more women through and people see it being done in a different way, we kind of perpetuate the issue.
I've had a lot of mentors, I've been very lucky to have a lot of mentors in my life. But I think mentoring is really difficult because you naturally try and coach somebody into your image, I'm probably guilty of that. I always think if we had all female boards, we don't we'd end up with all female managers, you know, and then there's no malice there, or it's just people are trying to be helpful. But when you're mentoring someone, it's back to this point about difference, you've got to realize that you and I, and we were all completely different. And to mentor and to get people through to a senior level, you've got to have a high enough EQ to understand what matters to them, and therefore how you can flex the organization.
So when we come back to what data is actually required, there is a hard data about the pay gap that forces the conversation, but I think the actions are much more complex, and they've got to be quite intelligent about the social trends and what's actually driving behaviors, it's not data, it’s behaviors.
I couldn't agree more. And in fact, recently in your Home Office role, you very kindly made an introduction for me to the anti-slavery unit. And that's a perfect example of an area that can benefit from data. And Dun & Bradstreet are starting to do some, some very interesting stuff about that, and I can't talk too much about it. But that was very kind. Thank you.
So we're coming towards the end of it. I like to ask some slightly lighter hearted questions. Definitely no more questions about insurance.
As long as they're not about football.
Also not football, or about rugby, for that matter.
Oh, we sponsor the rugby at Gallagher’s, remember?
That's also true. Yeah. I don't know. still feels a little bit raw. From last weekend. You, spent a little bit of a time outside of the UK in your various roles. Which area do you think's going to have the most substantial growth over the next 10-15-20 years?
I think that's a difficult one to call. China, you know, Asia are the kind of areas we look to, but I think especially with Brexit, it's really important not to neglect any of our markets at the moment. I just think, you know, any good company basically needs to make sure we are as open and transparent as possible and as easy to trade with and have access to as possible going forward. And to me this, that's the key point.
I'm in total agreement. What's on the Sue Langley bucket list
A nice holiday in the Maldives in a desert island.
That's on everyone's bucket list.
Yes. You know, it goes back to that first question I call my career an accidental career because I only ever applied for the first job. When I look back at what I've done, I realized I've been incredibly lucky. I would never have named these jobs when I left school or when I did a geography degree. So who knows?
And you talked about mentors. It's a question I love asking people. I've had some wonderful mentors in my relatively short career, who have been some of the most impactful people that you've had the fortune of learning from.
I've learned from so many people and people teach you different things because once again, they're individuals and have something to bring. I remember a lady NED when I first joined the Northern Rock board, you may find this slightly strange one to quote, but she took me out and told me I did not dress for success. And it's a very interesting conversation around ability and perception in a role. How are you perceived and the unfair perceptions around how you potentially look and how you dress. So I always remember that one as not necessarily a key one but as the most impactful one because nobody had ever said that to me before.
I find it hard to believe that you would have turned up in your pyjamas. Sounds like it might have been a bit tough.
She was very demanding and very tough tough but yes, it was all around looking like a smiley individual.
I feel naked without my tie, I hope you’re not judging me. Sue we've come to the end. A huge, huge thank you for coming in and speaking to us today. And best of luck with everything that you have going on and your five jobs.
Thank you. Thanks for inviting me in.