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Company: Aflac Incorporated, U.S.
Sector: Supplemental health insurance
Accidents will happen, and we are all vulnerable to medical emergencies. The supplemental health insurer Aflac Incorporated serves a huge market of policyholders in the U.S. and Japan who are concerned their basic health insurance will not cover the full cost of even minor treatment, such as a fall at work requiring emergency first aid or a short stay in the hospital for an appendix operation. In 2019, Aflac's new governance, risk and compliance (GRC) team conducted an assessment of the existing GRC program and tool to proactively identify opportunities for improving processes and programmes.
The team developed a roadmap to help transform the risk program with the goal being to automate manual processes, integrate risk functions and improve data quality. Failure to address the areas of improvement potentially created another risk – an inability to identify Aflac’s risk posture.
The solution in action: PwC’s integration with Aflac’s global risk and compliance program
In 2019, Aflac commissioned PwC U.S.’s Advisory teams to help develop an integrated, global Enterprise Governance, Risk and Compliance (EGRC) program that would overcome the challenges of managing and aggregating disparate risk and compliance programs in two different countries.
As a result of our thorough, systematic analysis of various aspects of Aflac’s GRC program, we were able to identify areas that needed immediate attention. For example, poor governance of the existing GRC tool was leading to reduced adoption and causing Aflac's risk teams to instead rely on duplicative technologies and manual processes. Our analysis also confirmed that risk was often managed in silos, and there were few opportunities for collaboration with colleagues in other departments and countries. Over time, these issues led to reduced visibility with no single, company-wide view of risk globally.
“Since the initial GRC implementation with a previous provider was unsuccessful, we knew we had to focus on user adoption which meant re-building confidence and trust. To accomplish this, we started with the basics by bringing key stakeholders to the table, establishing a governance model and creating a joint vision focused on sustained, clear outcomes."
Our goal was to prioritise people and processes over technology while helping to create a global program that would provide Aflac with a panoramic view of its risk, enhance the existing GRC tool, and ultimately help enforce alignment and collaboration between risk functions around the world. Aligning programs in the U.S. and Japan, each with differing regulatory landscapes and risk classifications, required not only process and technical experience, but also innovative thinking to overcome the practical and cultural challenges.
“In today’s rapidly evolving insurance market, organisations have to cope with greater uncertainty due to new regulations, stringent compliance mandates and increased cyber threats. The GRC team from PwC helped us realise that risk transformations cannot be handled in siloes; instead, they need to combine people, processes and technology to help shield the organisation effectively.”
From the outset, we spent time establishing global governance committees inclusive of EGRC leaders in Aflac’s U.S. and Japanese markets. We confirmed that the restructured governance committees reflected leadership’s views and that EGRC personnel were fully trained in how to harness the benefits of the new technology-empowered platform. As part of this effort, a global executive steering committee was established to lead the transformation and was tasked with enforcing the need for Aflac to adapt to the new GRC platform and program. With their leadership, success was realised.
"As a large scale organisation, our biggest challenge was aligning opinionated risk professionals and disjointed processes. To overcome this, we harnessed the power of shared vision and agile deployment. We established a strong cadence of programme governance, which created a healthy forum to drive agreements. With people connected, we took an agile approach to accelerate process alignment through prototypes and showcased the power of shared data, leading to faster actions. This showcased the value, built trust, and encouraged alignment across risk groups globally."
The human factor: How Aflac’s people benefit from risk transformation
Aflac’s revised EGRC platform, which was launched in 2021, has increased work standards and reduced employees’ frustration at being required to perform repetitive, time-consuming manual risk processes. Previously working in silos, risk teams across 16 different business functions are now united within a single risk classification system, enabling them to exchange better ideas and practices. Employees have found a significant increase in efficiency, quality and the ability to track and utilise real-time data which, in turn, has helped them not only meet leadership objectives but also manage risk more proactively.
Two other crucial groups of stakeholders that also benefit from Aflac’s transformed EGRC program are investors, because they see a business that is managing risk well and cost-effectively, and Aflac's leadership team, who may be more willing to engage in new ventures as they are confident that their teams are appropriately managing risk globally.
“It’s easy to lose sight of the bigger picture when you’re engaged in a complex risk transformation that leverages new technology, however, the key to meeting objectives and user adoption is that the change is driven first and foremost by people. At the end of the day, enhancing the risk culture should be the key focus of any GRC programme and putting people first and taking them along on the journey tremendously helps get there.”
This article is for informational purposes only and is not a solicitation for insurance.
Z2300048
EXP 1/2024
Aflac | Aflac New York | WWHQ 1932 Wynnton Road | Columbus, GA 31999
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