Andrew Horton, CEO of specialist insurer Beazley, wanted to find a way to encourage more engagement between his 1500 staff and the executive committee (‘exco’). His first idea - televising exco meetings so all employees could tune in - was rejected for being too wacky. His next - setting up a “NexCo”, drawn from the firm’s younger talent who each represent one of the executive committee members - has been a rapid success. Now into its second year, the NexCo is being adopted and examined by other firms who are in the know. Here, in the first of a series where high-fliers explain a big idea that really works, Horton explains how his NexCo works.
An exco-shadowing experience to engage younger staff and build your pool of input into big decision-making sounds so simple. But where did the idea come from?
I’d been talking to our head of talent management for a while about finding a way to get more people involved in what our executive committee do - people hear about the committee, and aspire to get onto it, but many are not exactly sure what it does. And I wanted more voices having a say across the company. I had some wacky ideas - at one point I suggested we televise exco meetings, turn it into a fishbowl where everyone could see them - but that didn’t go down well! Eventually, though, I came to the idea of setting up a younger, different executive committee - another group of people, with access to exactly the same papers as the executive. The NexCo name came naturally - it’s made up of our next leaders.
How does it work?
Members of the executive committee nominate a NexCo member from each of their departments - finance, risk, front line business, talent management, and so on. The NexCo has 14 high-flyers.
The NexCo members meet monthly, receiving the same set of papers as the main executive, and are encouraged to share the agenda and any discussions with others in the firm - it’s not a secret club. One executive member attends each meeting too - not as Chair, but just in case the members get stuck on anything. It’s great for transparency and communication, and for getting ideas from throughout the company.
We also have a more diverse perspective on important Beazley decisions, spread understanding of strategies, and encourage younger staff to find out about governance and progress. It’s unpaid, but very popular - each NexCo has a 12-month spell, with a two-month crossover with the new cohort - and most don’t want to leave it.
What about confidentiality?
That was an early concern - that the exec paperwork would contain lots of confidential information that we couldn’t share. We concluded that only M&A and some people-based information would have to be redacted, and actually, that hasn’t cropped up at all in our first two years of implementation - individual employee talk just doesn’t happen within exco meetings. We found that our culture of trust and empowerment naturally flowed through to NexCo.
What has the existence of the NexCo changed at Beazley?
It’s helped us take a fresh look at so many issues. It’s a younger, more diverse voice. One area has been tech budgeting. Most financial services companies have no real clue about how much to spend on tech and how it should interact with the company. And people like me, on the exec, have scars from large tech spend that delivered very little. So we naturally shy away from it. But the younger generation are less worried. The NexCo did a deep dive into our tech spend last year, and came to the radical - to us - conclusion that we weren’t spending enough. They offered excellent thoughts on how we could spend our budget better, and it’s spurred a change in how we look at technology. Projects these days are more bitesize; you don’t have to spend billions on new technology, but can run small tech campaigns.
The NexCo is also addressing topics outside the main executive focus - taking on more work, and then presenting back to the main executive. It’s hugely uplifting, and what they have found is influential within the business. Their contributions are making a difference to the running of the company, and that’s important for their own development.
How does the make-up of the NexCo compare to the executive?
The NexCo is far more diverse, in terms of gender, geography, and background. We’re all struggling with becoming more diverse companies - at Beazley we’re heading in the right direction and have recently had two more women joining the exco - but interestingly our nominations for NexCo were immediately more diverse. It’s partly because lower down in the organisation it’s much more balanced, so when the executive nominated members, naturally it was a more balanced board. On gender, it’s 50:50 for NexCo; our executive isn’t there yet. The youngest NexCo member is in their very-low 20s. It’s also more geographically diverse - we have someone from our Barcelona office and members from our US offices too; they mostly participate by video conferencing.
Given our chat, you’re obviously happy to share your great idea - are other firms adopting it?
It’s a differentiator for us and is working really well so I’m not desperate for our competitors to adopt it! But I’m happy to share my idea; in any case, I think it’s the implementation and the culture of your organisation that counts to its success. I understand that the broker AON has implemented a similar idea, and I met up with someone from the Bank of England who’d heard what we’ve started and wanted to know more.
What does the executive and NEDs think?
One of the NexCo’s major contributions has been getting the executive to think in a different way - it challenges their (and my) held views. As we become older we’re more fixed in our ways, and have had loads of experiences. So every problem that comes at me, I think ‘when this happened in the past, this is how I dealt with it.’ The NexCo hasn’t had that, and might have another - better - way to solve something or achieve something.
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