The past eighteen months has seen notable change across leadership teams in financial services, specifically within the insurance and banking markets. From new CEOs charting their courses to broad organisational restructures, there has been an uptick in movement. Based on my recent discussions and engagements, we expect this trend to continue throughout the calendar year.

In banking, following an intense period of courting borrowers in the tightly contested home loans segment, we are seeing some reprieve in activity with banks softening their tactics and shifting to other growth engines, with business banking receiving renewed attention. Investment outlays suggest an increasing focus on productivity and growth initiatives. Central to progressing these initiatives is having the technology to deliver superior customer experiences supported by efficient internal systems. Consolidation has been a theme as well, especially in mutual banking where we saw two significant mergers completed in 2023.

Although not exclusively a function of the evolving market, there have been CEO changes across all levels of banking in Australia, from the Big Four to mutuals and even foreign-owned institutions. Changes, as a result of the appointment of new CEOs, are already starting to happen.

Across executive leadership teams, movements within functional roles have been moderate particularly within marketing, risk, finance and people functions. However, the realms of technology and transformation proved to be the most active with at least 15% of appointments across the banking sector. So, where is the talent coming from? A great deal of these has come from competitors of similar scale; overall, almost a third of appointments were internal. In marketing and people functions, we have seen some move from the consumer sector. Appointments from adjacent industries have never been the norm in banking; however, we are seeing individuals in senior technology roles coming from the insurance industry and even specialist consultancies. Given the heightened activity in the market for senior technology leaders, there is arguably a shortage in high-quality executives from within the sector. Adding to this, some appointments from outside the industry can be seen as deliberate moves to really challenge what exists and step up capabilities instead of playing catch up from a technology perspective.

In insurance, around 20% of leadership teams across leading firms were appointed to their positions last year. There is a significant number of companies still undergoing some form of restructuring. Some multinational firms are revisiting their regional approach, while others are shifting from a functional to a value stream-based structure. Interestingly, almost 90% of these individuals have prior experience in insurance; of the remaining 10%, there are only a handful with no previous tenures in financial services more broadly.

General insurance providers are faced with increasing frequency and severity of natural hazards as well as rising reinsurance costs. With the upward pressure on premium pricing and the current cost-of-living crisis in Australia, there is heightened public scrutiny towards these groups. With the renewed focus on costs, realising operational efficiencies through technology enablement has been a key theme, with notable appointments in senior technology roles coming from the banking and consumer sectors.

Life insurance has been in a challenging position for some time. Following significant consolidation and channel contraction, questions about the way forward persist as some have described moves to gain market share as “shifting slices in a shrinking pie.” With limited options for inorganic growth, growth through organic means has led to a shift into new product types that others are only starting to explore. We are starting to see appointments for executives with these growth mandates coming from other segments of financial services where parallels to these new offerings already exist.

As we approach the halfway point of the calendar year, it seems that the level of activity in executive movements is on track to outpace that of last year as we have already seen as many movements in banking and insurance for the same period. The executive market is also well engaged, suggesting a keenness to explore other opportunities. And finally, with a whole raft of changes coming, tough decisions will be made – questions on who’s in and who’s out are being asked.

Paulo Jose
Financial Services Practice

Contact us