Message from the Chairman
21 August 2020
The events of 2019–20 will be remembered by all of us and will be some of the most defining in Suncorp’s history.
As a prolonged drought continued to devastate regional communities and economies, our nation faced one of the worst seasons of natural disasters in Australia including 12 major insurance events spanning floods, hail and bushfires. While we were still grappling with the impacts to people and communities, the COVID-19 pandemic created a global health and economic crisis. The impacts of this terrible crisis continue to be felt through a significant loss of life, and the likely longer-term health and economic consequences are still emerging.
Suncorp entered the uncertain period of COVID-19 in a sound financial position and moved quickly to prioritise the health and safety of our people and ensure hardship measures were in place for customers in need. The resilience of our business has been demonstrated with a capital position that remains strong, and stable growth in our core business portfolios.
We know that our shareholders expect a predictable and sustainable return and the Board is pleased to have determined a fully franked final ordinary dividend of 10 cents per share. In paying a final dividend, we have also been mindful of maintaining our strong capital position and recent regulatory guidance. For the 2020 financial year, our full year dividends to shareholders totalled 36 cents per share.
#Embracing new opportunities
Throughout the year, your Board and management team have been meeting more frequently to monitor the short-term operational implications of the rapidly changing environment. We know we are not immune to the unpredictable outlook and continue to adopt a flexible approach, to enable us to respond quickly as circumstances change.
As you would expect, we have also undertaken longer-term scenario analysis to ensure our business is well-positioned for the future. The experiences of this year have significantly changed our perspective on what is possible and as a result, we are accelerating our transformation plans.
Our workforce planning will incorporate more flexibility for our people and ensure we have the skills and capabilities necessary to meet the changing needs and preferences of customers.
While customers will continue to engage with us in a variety of ways, COVID-19 has driven much higher adoption of digital channels. This presents opportunities for improvements in customer experience, claims excellence and operational efficiencies through greater use of data and automation.
The growing use of technology is rightfully increasing community expectations about transparency, and this year we developed a set of Data Ethics Principles to ensure our stakeholders have visibility of the way we use and manage data. The incidence of cyber and financial crime is also increasing, and we continue to invest in detection and prevention systems to detect scams and protect our customers.
Suncorp’s Customer Committee has continued to provide the Board with an avenue to see our business through the eyes of our customers. The Committee, established in 2018, has played a pivotal role in helping to define the Group’s customer strategy and ensuring the organisation is aligned around delivering the right outcomes for our customers.
The insights provided to the Committee proved incredibly valuable following this year’s natural disasters, which again highlighted the consequences of a changing climate and its impact on global reinsurance prices.
We have taken significant steps in 2019-20 to better understand the strategic and financial risks and opportunities presented by climate change. We continue to advocate for greater investment by government in natural hazard resilience, as well as a more coordinated approach towards mitigation between industry and all levels of government, just as we have seen during the COVID-19 response.
This is needed now, more than ever, to reduce the impact of natural disasters on our customers and communities and boost the resilience of our economy to future weather events. As changing weather patterns drive up global reinsurance costs, we need to ensure insurance remains affordable and accessible to everyone. Greater investment in disaster mitigation and natural hazard resilience would also provide much-needed stimulus, particularly in our regional communities, as Australia’s economy continues to feel the impacts of COVID-19.
In September 2019, the Board was pleased to permanently appoint Steve Johnston as Chief Executive Officer & Managing Director (Group CEO). Group General Counsel Belinda Speirs was appointed to the Leadership Team in October 2019 and Jeremy Robson assumed the permanent role of Group Chief Financial Officer in December 2019.
Changes to the Group’s operating model announced on 1 July 2020 resulted in the promotion of longstanding Suncorp executives Lisa Harrison and Paul Smeaton to the roles of Chief Executive Officer Insurance Product & Portfolio, and Chief Operating Officer Insurance, respectively.
The Group also welcomed new executives Adam Bennett as Chief Information Officer and Clive van Horen as Chief Executive Officer Banking & Wealth. Adam and Clive bring a wealth of transformative financial services experience.
In January 2020, the Board appointed Elmer Funke Kupper as a non-executive Director. Elmer is an accomplished business leader, having held senior executive positions with ASX-listed businesses. He brings considerable experience in navigating demanding regulatory environments, and in transforming business models through the adoption of technology and digital services.
On 30 September 2020 we will farewell Audette Exel, who has made an extraordinary contribution to Suncorp in her eight years of service. Audette brought extensive commercial experience, gained both domestically and internationally, to the Board. Her deep experience in banking and reinsurance and her passion for the purpose of Suncorp’s business has proven invaluable and we wish her every success in the future.
On behalf of the Board, I would like to acknowledge that it has been a particularly difficult and challenging year for shareholders, and we thank you for your continued support of our business. I would also like to thank Suncorp’s executive team and employees for their adaptability and flexibility around our new ways of working, and their continued commitment to meeting the needs of our customers.
Considering the extraordinary circumstances in which we currently find ourselves, the Board has decided to hold this year’s Annual General Meeting (AGM) in October online, rather than at a physical location.
While it is unclear how long it will take for our economy and society to fully recover, rest assured that Suncorp is embracing the opportunities that will enable us to evolve and transform our business and deliver better outcomes for our people, customers, communities and shareholders.