Management: UK chief executive Brendan McManus, in characteristic take-no-prisoners style, joined Aon in the battle for commission at the start of the year. His demand for a 1.5% commission uplift from underwriters in the global property market continues to meet resistance.
It’s clear why McManus wants the financial boost: in August Willis posted a profit of $119m (£72m) in the first half of the year, down 59% on the $293m it made in the same period last year.
Strategy: The results followed an $81m operational review charge, an $11m fine from the FSA (see Big story, below) and a $124m charge related to the repurchase of senior debt. Without these charges, the company would have made a $331m profit for the first half.
Willis has focused on organic growth ever since McManus took over in 2007, but it continues to evolve. For example, in August Willis Networks, which has 111 members, announced an alliance with Broker Direct’s OurNetwork, which has a membership of 280. Each network’s members will have access to the others’ services and facilities.
Big story: In July the FSA slapped a £6.9m fine on Willis – the largest the authority has ever imposed on an insurance broker – for failing to have the proper anti-bribery controls in place between 2005 and 2009.
This record penalty serves as a warning shot to the broking community. Willis is far from alone in making payments to third-party ‘introducers’ overseas, but as this once widely accepted practice comes under increasing regulatory scrutiny, international brokers are having to change the way they do business.
Willis co-operated with the FSA and agreed to settle at an early stage of the watchdog’s investigation.
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