Sunday, February 5th, 2023

No recession ‘crimson flag’ for Marsh but, says CEO

Learn extra: Marsh McLennan pronounces Q2 2022 outcomes

“I don’t assume there’s a extra resilient organisation that you might truly spend money on,” was the CEO’s bullish message.

“I do assume it’s essential to notice that in in all previous recessions since 1952, we grew adjusted EPS and we all know the right way to run a enterprise in good occasions and in unhealthy occasions,” Glaser mentioned.

The broking boss described recessions as a “pure type of the financial cycle in a capitalist society.”

“We don’t fret over that, and we don’t plan all that a lot round it,” Glaser mentioned.

The insurance coverage market “is agency and stays agency”, Glaser mentioned, with reinsurance on the property facet “even tightening”.

Financial downturn impacts are usually first seen in its non-insurance companies, Oliver Wyman and Mercer, Glaser advised analysts.

“The crimson flag just isn’t going up fairly but, however we watch it fastidiously,” the CEO mentioned.

Marsh McLennan made 6,000 web hires final 12 months and the Glaser described this as “fairly excellent [in retrospect]”. The enterprise has slowed hiring into 2022, Glaser confirmed, having returned to a “extra regular” sample in line with 2017 to 2019.

The slowdown “just isn’t cautious”, Glaser mentioned, however as a substitute recognises the dimensions of recent hires in 2021.

As for the place the worldwide dealer would possibly put measures in place if financial circumstances warrant this, Glaser mentioned the enterprise stays within the “early to mid phases” of having the ability to drive operational enhancements and minimize inside prices.

“Most of our prices are fairly identifiable – you have got compensation and advantages, you’ve acquired expertise, you have got premises or actual property, and you’ve got T&E [travel and expenses],” Glaser mentioned.

“So the levers you can then utilise are beneficial and I’ve to say now we have a really giant […] compensation pool pushed by profitability.

“It’s dramatically bigger than it was a decade in the past or 5 years in the past as a result of our profitability is dramatically bigger, and that offers us super flexibility of defending shareholders within the occasion that we hit some headwinds on progress or macro-economic elements.”

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