DO WELL TO DO BETTER
The counterargument that has arisen in the public backlash since the announcement is that Income Insurance, as a social enterprise, was never meant to pursue revenue and profit. And that any newly gained profits after this deal would go to private shareholders, not Singaporeans.
But to be more effective, it calls for more resources and new market opportunities, especially when Income Insurance’s competitors in the local market are mostly multinationals. Failure to keep up could mean it cannot fulfil its social mission anyway.
Indeed, Income Insurance is one of four “domestic systematically important insurers”, designated by the Monetary Authority of Singapore (MAS) in September 2023, whose failures would significantly affect the Singapore economy.
If the deal goes through, the new majority owner Allianz cannot afford to lose the faith of the people in Singapore, particularly the workers.
If it didn’t before, it knows now that there is an expectation to honour Income Insurance’s social responsibilities. If products are priced at a level seen to be in the relentless drive for money, workers would have less reason to be drawn to the company.
Allianz should be more than a shareholder. It may need to make a profit but the question is not just how much profits are being made, but how they are made.
The priority of Income Insurance now is to ensure its long-term growth, including and beyond achieving financial sustainability. Being a valuable and versatile company is in the best interests of workers and Singaporeans.
It is good to do good, but the new Income has to do well to do better.
Lawrence Loh is Director, Centre for Governance and Sustainability of NUS Business School at the National University of Singapore, where he is also Professor in Practice of Strategy and Policy. He is a policy holder of Income Insurance.