The people impacts of Solvency II
Is the most valuable asset in your organisation ready?
Despite the FSA’s planning assumption that firms will not need to meet the requirements of Solvency II until January 2014, a year later than expected, the next year remains a critical period in the journey toward Solvency II compliance as companies prepare to parallel run their internal models in readiness for going live at the end of January 2013. Though this may seem a long way off for some, the new capital and risk management regime is driving wide reaching changes that stretch beyond the enhancement or development of a new model for calculating capital.
Unlike previous regulatory changes, the culture of the organisation, the knowledge of key stakeholders and behaviours demonstrated in terms of decision making will be critical for compliance. Success will not only depend on the presence of a robust model and accurate data, but also on how effectively the organisation has embedded the new philosophy into the heart of its culture.
Due to the centrality in managing the people agenda, the human resource function (HR) is critical to the successful implementation of Solvency II. With experience suggesting more needs to be done to engage and involve HR in the debate, this paper addresses the key people implications of the Directive and provides a number of critical success factors which need to be considered.