Written by Gordon Watson
CEO of AXA in Asia & Africa and Founding Chair of SVIHK
Photo by ANGELA BENITO on Unsplash
CEO of AXA in Asia & Africa, Gordon Watson explains how he came to embrace Shared Value, a global movement which is celebrating its 10th anniversary this year, and became the Founding Chair of Shared Value Project Hong Kong, now renamed Shared Value Initiative Hong Kong.
Sustainability was an amorphous phrase when I first entered the workforce – it was limited to being ‘green’, reducing paper waste and recycling. It was easy to see how well-known not-for-profit groups like The Rainforest Alliance could contribute to the sustainability of our planet, but harder for corporations to demonstrate their commitment.
The UN launches its Sustainable Development Goals
Yet concrete commitments have been growing all around the world. First, global leaders, heads of states and governments came together to adopt the United Nations (UN) Millennium Declaration. This committed their nations to a new global partnership to reduce extreme poverty. These eventually morphed into the UN Sustainable Development Goals, which act as a guide to the areas where we as a society need to make significant progress.
At the same time, I began to read about the work of major companies like Nestlé who were integrating social and environmental issues into the heart of their strategies. For example, a key feature of Nestlé’s approach is to locate aspects of production in the developing world, close to where the raw materials are sourced, in order to create added value in those communities. 45% of its factories and 48% of its employees are located in developing countries, even though these countries represent less than a third of its sales. Nestlé has publicly stated that a fundamental principle of its economic investments is that they should be “good for the country and good for the company”. Nestlé also introduced its Cocoa plan, training smallholder farmers on regenerative agricultural practices and equip them with seedlings. This improves crop yields and helps strengthen communities. In this way Nestlé creates Shared Value in its supply chain.
Creating Shared Value based on four pillars
SVIHK offers member services based on four pillars of operation. First, we seek to inspire greater understanding of the business case for embedding Shared Value in corporate culture. Second, we empower our members to build their own Shared Value strategy and culture through access to tailored activities. Third, we convene tri-sector experts on Hong Kong societal issues to work with members on designing impactful, scalable and profitable solutions to these challenges. Fourth, we help members transform business models to create social impact and long-term performance.
How can insurance create Shared Value?
According to FSG, the consulting firm co-founded by Michael Porter and Mark Kramer, insurance is the ultimate Shared Value industry, where social impact is integral to economic success. By pooling the resources of the middle class, we can create life and health products that bring life-saving treatments to individuals who would not be able to afford the type of health care or post-life support for their family that they need if they were working on their own. Meanwhile, reducing accidents, improving health, and helping organizations better prepare for economic risks all improve the profitability of insurers.
Our work spans multiple areas, from risk prevention to addressing the needs of underserved customers and investing in support systems that help with prevention and protection. Here in Hong Kong, our award-winning critical illness product not only covers financial protection but goes beyond to cover protection for relapse and offers programs for rehabilitation. This helps to alleviate the financial burden on the family as well as on wider society in a more comprehensive way.
AXA also works with emerging customers in markets such as the Philippines and Thailand. Whereas insurance would often be out of reach for such groups, AXA has worked to develop simple, affordable products tailored to their needs to enable them to protect what they have built and reduce the impact of unexpected risks.
Looking beyond products alone, many experts are saying that the COVID-19 pandemic has condensed years of digital transformation and adoption into a matter of months. This has never been more evident than in the huge jump that telehealth made in 2020, when lockdowns and social distancing made routine visits to doctors or hospitals nearly impossible. AXA Asia was able to work with telehealth partners to ramp up their services and offer free teleconsultations to over 10 million people across Asia, both customers and non-customers, including underserved patients in remote, rural areas with limited healthcare access.
With the pandemic disrupting working practices in Asia, a major concern for employers has also been to support employees through this period while preparing for a return to the office after months spent working from home. AXA worked with our medical and psychological experts to produce two guides that would enable any company to safeguard its employees’ mental and physical health. These provided detailed guidance for managers on how to address mental health at work.
According to FSG, the consulting firm co-founded by Michael Porter and Mark Kramer, insurance is the ultimate Shared Value industry, where social impact is integral to economic success.
With the Shared Value concept now celebrating its 10th anniversary, momentum behind the movement continues to grow year on year as the world looks to overcome the challenges we face. As a Founding Member of Shared Value Initiative Hong Kong, AXA will continue to offer help and inspiration to new members of SVIHK, particularly social innovators who are committed to aligning profit and purpose.
About Gordon Watson
Gordon Watson is the Chief Executive Officer of AXA Asia and a member of the Management Committee of AXA Group. Gordon has a MBA and is both a Fellow of the Chartered Insurance Institute and the Society of Marketing.