From: Captive Insurance Times

Frances Jones explores how EB captives can support and accelerate an organisation’s DEI objectives

Businesses have turned their attention to diversity, equity and inclusion (DEI) in recent years — a move that has been catalysed by societal movements, such as Black Lives Matter (BLM) and #MeToo. These awareness campaigns have spotlighted deep-rooted societal discrimination and prejudice, primarily against ethnic minorities, women and the LGBTQ+ community.

Companies are increasingly using employee benefit (EB) captives as a mechanism to push their DEI objectives forward. EB captives present the opportunity for a parent company to normalise plan designs across geographical boundaries, presenting an array of coverages that would otherwise be excluded or limited from certain areas.

Using an EB captive to further a company’s DEI strategy has the potential to reap wide-reaching benefits for a company’s culture, creativity and future profitability. But how are DEI strategies becoming such a strategic imperative for a company’s long-term future?

Changing the status quo

According to a 2021 analysis by the Washington Post, only 8 per cent of the top executives in the top 50 “most valuable” public companies were black. It also found that at least eight of these companies employed no black executives. The investigation was prompted by the 2020 BLM movements, underpinned by the brutal murder of George Floyd and the immediate protests following his death.

Alex Gedge, a senior captive consultant at Hylant, notes: “Consumers and workers increasingly demonstrate that DEI and ESG issues are critical in purchasing and employment decisions. It’s unsurprising that companies are developing frameworks to bring these objectives to the fore. Since May 2020, US companies have committed about US$340 billion to fight racial injustice, according to McKinsey in 2023.”