AS READERS OF ICP well know, the insurance industry is on the hot seat. Since October 14, when New York State Attorney General Eliot Spitzer filed a civil suit against Marsh & McLennan Cos. for allegedly cheating customers with such practices as bid-rigging and kickbacks, investigations of wrongdoing have rocked the industry. After the mutual-fund debacles of the past few years, and continuing SEC and NASD investigations of ethically questionable practices, some pundits say the entire financial services sector is in crisis.
If the crisis precipitates a more open and ethical way of doing business, it may not be completely bad news. In my view, CEOs who lose their moral compass in pursuit of profit deserve to get the boot. Less than two weeks after the initial allegations against Marsh, the company's chief executive and chairman resigned. His successor promised new practices aimed not only at spurring settlement talks but at positioning the company — the world's biggest broker of insurance — as a leader in industry reform.
It seems pretty clear that, one way or another, reform is imminent. It's not going to make life easy for industry meeting planners, already under pressure to cut costs and avoid any appearance of excess. There will be more pop-up internal meetings, more executive planning meetings, and more meetings to educate and motivate the troops. One of Marsh's new initiatives, according to an Associated Press report, is annual compliance and ethics training. Meeting planning departments will be busy.
Another aspect of reform is full disclosure of policies and procedures. I hope this extends to talking about meetings and incentive programs as well. Corporate communications departments at insurance and financial services companies should be all over the media with information about why they hold conferences and events. They should be trying to educate the public about the role incentive programs play in motivating and rewarding performance. They should not be afraid to talk about how their meetings comply with regulatory guidelines, even if those guidelines are unclear. Being open — whether about the details of best practices or the need for reform — might help deter future investigations.
Take a Leadership Role
This is also an opportunity for planners to step up to the plate and communicate the value of their meetings and incentive programs to corporate public relations. Learn as much as you can about the current regulatory environment because showing that knowledge will help put you in a leadership role. And it is particularly important to show why incentive programs are legitimate sales generators, unlike bribes or kickbacks.(A good source for information on the www.performanceforum.org.)of strategic incentives is The Forum for People Performance Management and Measurement at
Speaking of planners in leadership roles, hats off to Lynne Schueler, Principal Financial, and to Leanne Acton, Penn Mutual Life Insurance, for their candid insights on why strategicworks to enhance their in-house meeting planning departments — and their own status within their companies. Go to page 26 to read their stories — and write me a quick e-mail to let me know how you weigh in on the issue. I'd love to hear from you.
All best wishes to you and yours for the holiday season.