Insurance companies must have "a degree of ambition" in their plans to improve diversity and inclusion at senior levels, otherwise they will be asked to revise them, Central Bank deputy governor Ed Sibley said on Friday.
"To my mind, there is a startling dissonance, not in every case, but overall, between what we hear and what we see in terms of action," Mr Sibley said.
He was speaking during a virtual event held by Dive In Ireland, an insurance sector movement to support inclusive workplace cultures.
Some companies have a policy and perhaps an action plan in place “with nice words from the CEO”, he said, “but if you probe underneath that, there is no engagement from the board, no engagement from the executive”.
The Central Bank recently directed 11 top insurers based in the State to submit plans outlining how they will do better on diversity and inclusion. This followed a review that found the insurers nominated women for only 21 per cent of senior positions between 2012 and 2018, despite having an even gender split among their wider workforce.
The review also found women represent just over a third of those in the top 25 per cent pay bracket in those companies.
Mr Sibley, who oversees prudential regulation, said there were organisations that had “made really good progress”, but others where lip service was being paid.
The Central Bank is examining whether its fitness and probity standards for senior appointments in regulated financial services providers is potentially exacerbating a lack of diversity at the top or “discouraging change”, he said.
Mr Sibley, who grew up near Southampton in England, said seeing how his two younger adopted brothers, who are of Afro-Caribbean descent, were treated differently by society because of their skin colour had given him "an awareness that I wouldn't otherwise have had".
When he first joined the Central Bank in 2012, he was struck by a “complete absence of ethnic diversity” in Irish bank boardrooms and executive teams and felt this “groupthink” – or having “very similar people looking at things in a very similar way and making very similar assumptions” – contributed to the Irish financial crash.
The Central Bank has giving more “energy and impetus” to its own diversity and inclusion plan over the past five years, Mr Sibley said.
“I don’t think you ever win all the hearts and minds, but it is about being clearer on the business case,” he said, referring to “compelling” evidence about the organisational benefits of using all the available talent.
“I don’t want to oversell where we are, because we still have some way to go. I think we have quite a long way to go on the ethnicity side – in terms of cultural diversity, we haven’t come as far as I would like.”
The bank has also been exploring how the Covid-19 crisis is affecting employees differently and how this might influence career progression and appointments.
“We have been trying to think about inclusion in the current circumstances we’re living through. Everyone is experiencing the pandemic in a different way,” he said, citing research that women are more likely than men to “feel the brunt” of additional caring responsibilities.
Regina O’Connor, who chairs Dive In Ireland and hosted the event, said the more active role now being taken by regulators on diversity and inclusion was not the only reason for insurance companies to pursue such initiatives.
“It is just the right thing to do.”