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After being recognised for the seventh consecutive year as one of the World's Most Ethical Companies, a US-based insurance broker and risk-management solutions provider has tackled why being ethical is good for business.
As the only insurance broker to be an honoree, Gallagher’s moral approach to business practices is formalised in its Gallagher Way charter.
But being nice is only part of being ‘good’. It’s also a competitive advantage.
Ephisphere research highlights that when indexed, listed World’s Most Ethical Companies outperformed the US Large Cap Index over five years by 10.72% and over three years by 4.88.
Ethisphere CEO Timothy Erblich recently commented on a shift in discourse around the world in 2017, leveraging the role of organisations as models for social behaviour.
”Global corporations operating with a common rule of law are now society's strongest force to improve the human condition,” Erblich said.
The World's Most Ethical Companies are assessed using Ephisphere's proprietary framework, called the Ethics Quotient, which generated scores in five key categories: ethics and compliance program, corporate citizenship and responsibility, culture of ethics, governance and leadership, and innovation and reputation. Gallagher is the only insurance broker to be recognised as a World’s Most Ethical Company.
“We value Ethisphere's research into highly ethical operations and we use that information to drive our ongoing improvement efforts,” said Thomas Tropp, Gallagher’s global corporate vice-president for ethics and sustainability.
Tropp visits Gallagher offices around the world, gleaning insights and conducting business-culture health checks – a role he has performed for more than a decade.
“Compliance tells us what we must do and ethics tells us what we should do,” Tropp said.
Angus Armour of the Australian Institute of Company Directors said that with financial institutions facing increased levels of scrutiny and the insurance industry reacting to numerous D&O liability claims, Australian boards are being forced to adopt similar cultural 'audits.'
“It’s a business argument for being proactive versus reactive. And the proof is in the bottom line,” Gallagher said in a statement.
