Young guns
Two new chiefs take the reins at McLardy McShane as the business saddles up for its next adventure
By John Deex
Fast-growing insurance group McLardy McShane has split the management of its business in two, ensuring further expansion and the retention of a people-focused culture that sets it apart.
From relatively humble beginnings in 2007, when founders Don McLardy and Mike McShane combined their businesses, the Melbourne-headquartered brokerage and authorised representative network has gone from strength to strength. It now boasts more than 600 staff and is on track to hit $1 billion in gross written premium by June.
But at last August’s Yellowstone-themed conference in the Blue Mountains, Mr McLardy retired as CEO, becoming executive chair, and Mr McShane moved into an executive director role.
Former operations head Meg Long stepped up as chief executive of McLardy McShane Partners (the licence-holding entity and 170-strong AR business), while Don’s son Nick was promoted to chief executive of McLardy McShane Insurance Advisors (the nationwide insurance brokerage consisting of the company’s 32 joint venture partnerships).
The pair have appointed separate executive teams as the business looks to enhance its strategic focus.
“We’ve got two key parts to the group that have grown so big, and require a different focus,” Ms Long tells Insurance News.
“With the joint venture business, we’ve got owner-drivers all over the country, and this enables us to give them a lot more attention. How do we help them run their businesses? How do we help them grow? How do we help them with strategy, business analysis?
“And of course we want to grow the AR business too, by adding new corporate ARs and finding operational efficiencies.
“I’ve no idea which side is going to grow quicker. We thought the growth would start to slow down this year, but it really hasn’t.”
Nick McLardy stresses that while the leadership has been split, from an AR or broker perspective, “we’re still very much one group”.
He says it made sense to focus management minds on the two sides of the business, to give them the best chance of maximising potential, but they remain closely connected.
“Having my sole focus working really closely with our joint venture businesses and looking for new acquisition opportunities is really exciting and a part of the job I really enjoy,” he says.
“But we like everyone feeling like they’re a part of the same group, same family, whether that be an AR, joint venture partner or administrative staff. We are really conscious that we don’t move away from that.”
The leadership and management transition marks the beginning of a new era, but the CEOs are determined not to neglect past principles upon which the business has been built.
Ms Long says the company’s people-first culture is always front of mind, and the fact she and Mr McLardy have been with the business for more than a decade is critical. The founders also continue to play influential roles and are always available to provide advice and mentorship.
“Maintaining that culture is a really important part of our strategy, and what’s great is that Nick and I have been here through almost the entire growth story, and worked incredibly closely with Don and Mike. Nick and I are both incredibly strong about leading by example and ensuring our executive teams hold culture at the forefront of their minds in everything they do.
“We’ve also got a lot of long-standing employees. Our retention rates are really high. It’s very rare we have anyone leave, and for that reason, they understand the story.”
The strong links the business has with the broader community and charity organisations give a sense of wider perspective and purpose. More than $4 million has been raised over the years for worthy causes such as FightMND, Cure EB and the Reach Foundation.
“That’s always been a core part of our culture, and we ensure that we get our people involved with all of that community work, and also our clients to a degree,” Ms Long says.
“As long as we keep our DNA around culture, community, giving back and being good people, that will stand us in good stead.”
Even as the group increases in size and influence, Mr McLardy believes it remains a family business at heart.
He’s not the only McLardy with a key role. Siblings Tim and Sarah are Victory Funding CEO and national manager of people and community, respectively. And Mike McShane’s daughter Georgia is an account manager.
“We’re not a corporate-style company like some of our competitors,” he says. “The charity aspect remains huge and we’re constantly in touch with those community partners through the year – it’s not just handing over a cheque and moving on.
“We feel like they’re an extension of our business and they feel like they’re involved with our company as much as we’re involved with them.”
Recruitment is key to culture, and when new brokers or ARs are brought into the business the number one consideration is whether they are the right fit.
“We aim to find people that already have those morals, those values, ingrained,” Mr McLardy says.
“And then it becomes infectious, for want of a better word. We feed off each other.”
Market gossip about McLardy McShane’s future and potential buyers often circulates, but Ms Long insists there’s nothing to it, and it might be a tactic to try to undermine one of its core strengths – stability.
“I can tell you that we have never sat down with anyone to discuss a sale,” she says. “Really, never. “There’s a number of us, including myself, who have been able to buy into the business in the last couple of years. We’ve got three of Don’s kids in the business. His other daughter has just started an insurance role in London. Mike’s got a daughter in the business. We’re not selling.”
Steadfast holds a significant stake and Ms Long says the arrangement continues to work well for both parties.
“They’re a great support. [Steadfast executive] Nick Cook has just joined our board. We’ve got a great relationship with Steadfast and a great relationship with Nick, and I think we’re really fortunate to have him on our board.”
Mr McLardy confirms there’s no sale on the horizon.
“I hope we don’t sell, because then I’ll be out of a job,” he says. “Myself, Tim and Sarah – we all genuinely love what we do and the business that we’ve been lucky enough to get involved with.
“There’s certainly no intention to go down that road and we’ll keep attracting great people and great businesses that align with us.”
Looking at future industry challenges, Ms Long flags technological evolution and compliance as two important issues.
Edward Yoon has been appointed head of tech and transformation, as artificial intelligence becomes “a key focus”.
“Everyone’s talking about AI, and that’s absolutely a business priority.
“We want to get some back-end efficiency for our guys ASAP, so we’ve got a couple of projects we’re about to launch on that.”
The compliance responsibility is also huge, with new regulatory requirements continually changing the landscape and dire consequences for failure. Vanessa Enticott has joined as head of risk and compliance.
“It’s possibly the most important part of our business, because if we don’t have a licence, we can’t operate,” Ms Long says.
“Vanessa worked on both the broking side and the insurance side over the past 20-plus years, and she’s actually built out a new framework, really focusing in on auditing, education, and risk and control. It’s paramount.”
Mr McLardy singles out recruitment as a key challenge, striking a note of optimism as younger people increasingly see insurance as a career of choice.
“In the past few years I’ve noticed there is some really quality young talent showing interest in the industry,” he says. “When I first started, among my friends and networks I was certainly the only one going into insurance.
“But I think now, younger people are realising it’s a desirable professional career.
“There’s a real cohort coming through that are genuinely interested and have fresh ideas on the industry, technology and products.
“There’s a whole bunch of innovations coming through that there wasn’t 10 years ago.”
