Tag Archives : newsletter 77

European Affairs: FERMA meeting with MEP rapporteur on latest ELD report

The latest report on the Environmental Liability Directive (ELD) will be considered during a session of the Legal Affairs Committee on 19/20 June with a vote scheduled early September. FERMA will suggest possible amendments to the current text to refocus on the initial purpose of the ELD –i.e. to prevent and reduce the number of environmental damages.

On Tuesday 30 May, FERMA met with the office of Laura Ferrara, the Italian Member of the European Parliament in charge of this report published on 8 May. FERMA appreciates the emphasis in the report on promoting a culture of prevention and risk management with possible tax incentives for the companies engaging in risk management and prevention. The report contains, however, several areas of concern for risk managers. Among them are a possible extension of the scope of ELD damages to air or electromagnetic pollution and rewording to the definition of environmental damage to make it more consistent with the rapid evolution of industrial pollutants.

A recommendation for mandatory financial security remains in this report, despite an acknowledgement that the insurance industry offers good capacity. FERMA has not changed its position that this is not necessary or desirable.

In line with our intervention during the public hearing on ELD at the European Parliament on 11 April, we will emphasise the need to preserve the capacity of European organisations to invest so they can modernise the industrial tools of the European economy.

Business organisations raise concerns over country by country reporting proposal

Business organisations including ecoDa, Eurochambres and European Issuers have written to MEPs to raise concerns over the provisions of public country-by-country reporting. MEPs of the Committees on Legal Affairs and on Economic & Monetary Affairs were expected to vote on the report on 30 May 2017. Business argues that making country-by-country reporting public for every company operating in the EU would constitute a clear disadvantage for the European Union as an investment destination.

http://www.europeanissuers.eu/positions/files/view/592c19e34636d-en

 


Letter from Brussels

Europe in transition

Two months ago, we said that the EU was at a political, economic, social and emotional turning point. We saw converging trends for less Europe. Events since then, paradoxically, have helped Europeans to rediscover themselves and could be the trigger to revive the European project and economy.

Clearly, we are still in a period of transition:

  • Political choices and decisions in some countries are reshuffling the cards of the international arena. Pro-European centrist reformer Emmanuel Macron won the French presidency over far-right protectionist rival Marine Le Pen in early May. We await the upcoming elections in the UK, Austria, Italy and Germany.
  • US President Trump pulled the US out of the 2015 Paris Agreement on climate change – to a consistently negative reaction in Europe but an uncertain impact.
  • China has pivoted towards Europe and its commitment to international cooperation in trade, and the fight against climate change.
  • The massive ransomware campaign, WannaCry, caused havoc when it hit public and private sector organisations in many parts of the world, stressing again our dependence on technology and vulnerability.
  • The surge of terrorism in Europe since 2014, with attacks in Belgium, France, German, Italy and mostly recently the UK, has emphasised the need for European cooperation on security.

The EU has engaged into a debate on its future model, scope and priorities. The debate started with the publication of a White Paper on the Future of Europe and will end by the time of the European Parliament elections in June 2019.

In this White Paper, the European Commission proposes five scenarios for the Union’s evolution depending on the choices Europe makes: “carrying on”, “nothing but the Single market”, “those who want more do more”, “doing less more efficiently” and “doing much more together”. Three topic-related reflection papers are also under discussion: the social dimension of Europe, harnessing globalisation and deepening of the economic and monetary union.

“We Europeans must really take our fate into own hands… We must fight for our future on our own, for our destiny as Europeans,” said Angela Merkel after the G7 and NATO Summits.

The success of Europe will depend on its ability to navigate the waves of change.

Typhaine Beaupérin

 

 

 

 

 

 

 

 

 

 

 

 

 


Jo Willaert elected President of IFRIMA

Jo Willaert, the President of FERMA, has been elected President of the International Federation of Risk Management Associations (IFRIMA) for a term of two years.  During his presidency, Jo plans to focus on strengthening dialogue and cooperation among risk management associations worldwide to increase coherence in the work of risk management around the world.

IFRIMA has also admitted the merged German risk management association GVNW, as a new member. This brings IFRIMA membership to a total of a total of 21 risk management associations worldwide.

IFRIMA directors 2017:http://www.ifrima.org

 

 

 

 

 

 

 

 

 

 

 


Closing date for European Risk Management Awards draws near

The deadline for entries into this year’s European Risk Management Awards, hosted by FERMA and Commercial Risk Europe, is fast approaching. Nominations, which must come from FERMA member associations, are due by 28 July.

The 2017 awards follow the successful launch event last year and will once again reward excellence in risk and insurance management, as well as best-in-class performance from key service providers. They will conclude in an awards ceremony and gala dinner in London on 6 November.

Categories:

  • European Risk Manager of the Year
  • Lifetime Achievement
  • Innovative Insurance Programme
  • Rising Star

For more information contact

Véronique De Hertogh: veronique.dehertogh@ferma.eu or see HERE


Cyber risk governance event: registration now open

 

Registration is now open for the high level event organised by FERMA at the European Parliament on 29 June for the publication of At the Junction of Corporate Governance and Cybersecurity.  This report, developed jointly with the European Confederation of Institutes of Internal Auditing (ECIIA), contains proposals for a new European model of cyber risk governance.

Hosted by Lithuanian MEP Antanas Guoga, the conference will include speakers from the World Economic Forum, the Malta EU Presidency,the European Commission and, of course, risk and audit practitioners from European businesses. It is open to all interested risk professionals.

This report is the conclusion of six months of work by an expert group between FERMA and ECIIA, representing risk managers and internal auditors from eight EU countries and six economic sectors. Together they have developed innovative ways for organisations to internally organise the management of cyber risks.

The WannaCry attacks in May heightened awareness of the necessity of risk management readiness for cyber risks within a suitable governance framework. As the report will show, proactive work between the risk manager and the key functions of the company will allow a company to stress test its vulnerability to cyber risks and devise mitigation strategies.

For more details and registration, click HERE

Event details

29 June at 16.15-18.15 CET

European Parliament Room JAN 6Q1


FERMA Forum Keynote speakers

A stellar line up of KEYNOTE SPEAKERS to put the risk manager in pole position

Three eminent keynote speakers will fulfil the theme of the 2017 FERMA Forum: Risk manager in pole position: steering risks in turbulent times.

They are Swedish’s former Prime Minister and Foreign Minister, Carl Bildt; NATO Deputy Assistant Secretary General for Emerging Security Challenges, Jamie Shea; and Formula One’s Mark Gallagher.

 

Carl Bildt’s keynote address will be part of the Forum’s focus on Europe at the Crossroads, which is also the subject of a high level panel discussion. Sweden’s Prime Minister

from 1991 to 1994 and Minister for Foreign Affairs from 2006 to 2014, Carl Bildt is today associated with a number of international organisations. He serves on the advisory boards of the Centre for European Reform (London), the Aspen Institute Italia (Rome) and RAND Europe.

He is currently the Chair of the Global Commission on Internet Governance (GCIG), an initiative that will produce a comprehensive standard on internet governance. Noted internationally for his activities in resolving the Balkan conflict, Carl Bildt came of age as a thinker at a time when politicians and intellectuals sought refuge from war in the power of international organisations.

 

 

 

 

 

 

Jamie Shea, NATO Deputy Assistant Secretary General for Emerging Security Challenges, will provide the closing keynote speech on risk communication. He has been working with NATO since 1980, including in communications roles. The division that he heads today handles a growing range of non-traditional risks and challenges including terrorism, the proliferation of weapons of mass destruction, cyber defence and energy security.

Outside NATO, Jamie Shea is involved with several prominent academic institutions, including the Collège d’Europe, Bruges; University of Sussex, England and the American University, Washington DC.

 

 

 

Mark Gallagher will present a different perspective as he explains how Formula 1 moved risk management to front and centre of its activities following two fatal crashes one weekend in 1994. His introductory address is highly relevant to the venue of the Forum in Monaco, the home of one of Formula One’s prestigious events, the Monaco Grand Prix.

Today CEO of Performance Insights, Mark Gallagher began his career with Formula One in 1983. He spent seven years working in the media and as a consultant to Philip Morris International before joining Eddie Jordan’s fledgling Grand Prix team in 1990. He was a member of the team’s management board. He became part of the newly created Red Bull Racing management team in 2004, and was invited to lead Cosworth’s return to Formula One as an engine and technology supplier in 2010.

 

Last chance for Forum early registration offers

Discounts of up to €250 are still available for the 2017 FERMA Forum, and registered risk managers can bring a colleague for free – but only until 30 June.

Registration provides access to the entire FERMA Risk Management Forum, including the welcome reception, general sessions and opening keynote, exhibition hall (access to 50 exhibiting companies, three lunches and coffee breaks, two cocktails in the hall) and all workshops.http://archives.ferma.eu/ferma-forum-2017/

Leadership in lights

See the first Forum video:http://archives.ferma.eu/ferma-forum-2017/discover-the-forum-video/


Expert view: Brexit trade deal to serve insurance buyers By Dave Matcham, CEO, International Underwriting Association

Brexit trade deal to serve insurance buyers

By Dave Matcham, CEO, International Underwriting Association

Ever since the UK voted last June to leave the European Union, both the UK Government and EU negotiators have expressed a desire to sign an ambitious free trade agreement that minimises tariffs and regulatory barriers to cross-border business, including for insurance and reinsurance.

The London Market Group, which represents companies in the International Underwriting Association (IUA), Lloyd’s and brokers, is pushing strongly a right for UK-based insurers and reinsurers to accept business introduced to them by brokers from the EU. At the same time, a reciprocal right must be offered for EU carriers to do business in the London Market, unimpeded by additional capital requirements.

A free trade deal will not be easy. If no settlement is reached, the default position would be for the UK to fall back on its membership of the General Agreement on Tariffs and Trade and the World Trade Organisation (WTO). The prospect of trading advantages for insurance, and financial services generally, under the WTO General Agreement on Trade and Services (GATS)- annex, is far from certain. A “prudential carve-out” allows regulators to take any prudential measures they deem necessary to protect policy holders and ensure financial stability.

A new trade agreement between the UK and EU, therefore, is by far the best outcome to the Brexit negotiations. This would enable the London Market to continue providing uninterrupted cover to clients across the continent. Specifically, the London Market Group’s Brexit Roadmap calls for regulatory equivalence under Solvency II to be agreed with prudential regulatory regimes, so that companies can continue to be supervised by their home state.

 Contingency plans

An early agreement on an implementation period to move to a new deal is also to minimise business disruption. Uncertainty over whether insurance policies will be enforceable is already affecting the decisions of insurance clients, and current market access rights should be maintained in any interim period.

Many clients require policies with terms of three years and longer, which means that they now need certainty beyond March 2019, the scheduled deadline for Brexit. Even renewals for single year policies are only a matter of months away. This pressure of time is driving the decision-making of the industry. Insurance brokers, UK insurers and EU insurers in London are now considering the future structure of their organisations and making contingency plans that will need to be implemented in case no deal trade is struck.

Such plans include the creation of separate subsidiary companies in various EU member states. No single destination has emerged as a dominant choice with organisations generally opting for locations that put them close to their customer base and fit best with their existing global structures.

So far, the Brexit debate has, of course, raged most fiercely in the UK. Yet European companies will undoubtedly be significantly impacted by a change in the UK’s relationship with EU. Of the IUA’s 47 member companies, only five have headquarters in the UK. One-quarter of the IUA’s membership is accounted for by firms with head offices in other EU member states, including eight from Germany.

Clearly, a comprehensive trade deal, establishing mutual recognition between insurance regulators, is in all our interests. The London Market is a vital European and global insurance hub, providing risk managers with access to a concentration of expertise and capital that is not available in local markets. As negotiations begin in the coming months, it will be important for politicians on both sides of the table to keep this firmly in mind.

 

 

 


President Column

By the time you read this newsletter, the UK may already have its new government. Whichever party wins, it must continue the process of negotiating Britain’s exit from the European Union, widely known as Brexit.

The deadline for Britain’s departure is March 2019. Between now and then will be a period of continuing uncertainty for all continental European companies who do business with the UK, or those from other parts of the world who use the UK as a gateway into the rest of the EU.

Overall, the role of the risk manager will be to support the implementation of appropriate measures and ensure, for example, that the usual risk management criteria apply to new contracts, even if they are with a different subsidiary of the same company.

 

For risk managers who are responsible for their company’s insurance programmes, there will be a closer involvement. The London Market is an important source of capacity, especially for specialised risks, for many European businesses. As the CEO of the International Underwriting Association, Dave Matcham explains in our Expert View, (read Expert View here) a new trade agreement between the UK and EU will be by far the best outcome to the Brexit negotiations for the London Market to continue providing uninterrupted cover to clients across the continent.

Considerable uncertainty remains over such a trade deal, however. In the meantime, FERMA members are happy to see that insurers want to continue to serve them and are anticipating possible scenarios, for example by setting up offices in other EU jurisdictions.

FERMA is closely monitoring the developments at European level and Brexit negotiations. We consider it a priority to keep our members informed.

Jo Willaert