This interview is part of the Leading Asia series featuring in-depth conversations with the region’s most influential leaders on what it takes to lead in Asia today.
At the end of 2020, an unexpected merger of two insurance companies was formalized in Singapore. Singlife—an insurtech firm founded in 2017 that operated only on mobile—led a consortium to acquire a 75 percent stake in Aviva Singapore, a legacy player among the country’s largest insurance firms with close to 1.5 million customers. The SGD 3.2 billion merger was the country’s largest for the sector.
In August 2021, Pearlyn Phau joined as Group CEO to oversee the continued transformation of the resulting entity, recently rebranded as Singlife. The veteran banker, whose career has spanned roles from consumer banking and wealth management to private and digital banking in Singapore and Hong Kong, accepted the opportunity to build a new type of insurance company—one with the reach and scale of a well-established and deeply trusted brand but with the agility and innovation of a younger, more nimble start-up.
“It’s very exciting for me to be given the opportunity to make an impact and shape the development of a business that is very much connected to the lives of many Singaporeans,” Phau said in this Leading Asia interview with McKinsey’s Vinayak HV. During their conversation, Phau shared how she set about creating a sense of common purpose after the merger, her philosophy for picking leaders, and the core values that drive decision making at Singlife. Below is an edited version of their conversation.
McKinsey: What was the state of play in the newly merged Singlife when you took over?
Pearlyn Phau: There were two groups of very different people coming together. We had people from an insurtech start-up who, with their start-up mentalities, were used to ideating quickly and using technology to innovate and build new things; they weren’t necessarily always thinking of immediate profits. We also had the Aviva folks, who were focused on business returns—delivering profitability and products that the existing market wanted—and providing a good bottom line year on year. Losing money was never in their DNA and they may not have always been the fastest movers or the most dynamic risk takers. These two groups were on opposite ends of the spectrum.
Then we added a third group of people right in the middle, and these are the people who we’ve hired, and they’re very different from both of these teams. This group has different skill sets and is not necessarily from the insurance industry. We needed them to focus and build on customer centricity and to rebuild our tech stack. I brought in leaders ranging from customer journey, marketing, technology, and fintech, who had a range of skills necessary for us to execute our strategy going forward to build a new company and a new brand.
The challenge now is to get all these people to work well together.
McKinsey: How did you go about overcoming this challenge of bringing people from different companies and cultures together?
Pearlyn Phau: After completing the legalities and the system integration of the merger at the start of 2022, we have been focused on working to integrate the hearts and the minds of the people. Creating a new culture to align three disparate groups of people with common values, priorities, and aspirations has been the front and center of our efforts.
We kicked off a year-long culture-building program aimed at uniting the team. Now, as with any newly established company, mapping our purpose, vision, and mission is critical, as it serves as a common language and DNA.
We have resisted the temptation to come up with opaque, sexy-sounding words but instead really dug deep into what we, as a company, exist for, and that is to offer our customers a better way to financial freedom. We worked on this together and tested the concept. We believe that this resonates across the enterprise from the top of the house to the last person standing, and it’s highly actionable and operational.
McKinsey: How has the new purpose changed the day-to-day operations?
Pearlyn Phau: Empathy and trust, two of our core values, are essential, not only as leadership traits but for anyone to be a decent human being. We need to not only understand the challenges and pain points for our customers but also to inspire confidence in the promises we make and to have the ability to deliver on them when we are relied on. We want to find better ways to serve our customers, support our communities, and protect our planet. This customer-centric mindset is what drives us as we build next-generation products and services.
As we aspire to deliver on our purpose, we have to find better ways to do things internally, which means giving people the chance to make suggestions and initiate changes. From an operational perspective, this means that we must adopt a technology-enabled and customized approach when designing our offerings and when delivering next-generation products with trusted advisory services.
McKinsey: What about your top brass? How do you select leaders within the company?
Pearlyn Phau: I believe in hiring the person most suited for the job. I look for the person with experience and who has demonstrated results—someone with the right attitude who can convince us that they can take up this challenge and inspire others to rise to the occasion.
I look for problem solvers, I look for solution providers, and most important, I look for people with a sense of humor, which can be very, very helpful in stressful situations. I also think that the best environment to thrive in is one where everyone has an equal opportunity to excel and demonstrate their true potential. This is especially important for what we are building at Singlife, which is at the intersection between technology and financial services.
It’s about building a star team rather than a team of stars. And we need to empower them to make decisions, give them the space to make mistakes and learn, and recognize that, ultimately, the buck stops with the CEO.
I also believe in lifelong learning and curiosity. Even though we are leaders, we don’t have the answers to everything, and we may lack knowledge in certain subjects. I’m very fortunate to be surrounded by experts in different sectors who may be heads of departments or executives with three years of experience. I’ve adopted the reverse-mentorship program, where I get experts to come in and give me private tutorials on different subjects and domain expertise. I also firmly believe in doing, in addition to reading, so I try to get myself involved in the operational level so that I can apply what I’ve learned.
McKinsey: Faced with the current headwinds—inflation, rising interest rates, labor imbalances, supply chain woes, climate impact—what are some of the biggest challenges and opportunities for an insurance business?
Pearlyn Phau: Poor economic conditions and prolonged market uncertainty have made it challenging for many sectors. The life insurance sector in Singapore, for example, was down by 5.2 percent in 2022 from the year before. Yet the outlook for the insurance sector continues to look optimistic as more insurers buckle down and recalibrate tactics for the evolving economy.
The value of insurance is only truly realized when it is needed, and we fully intend to be there for our customers and their businesses when they need us. Our business model is resilient and well capitalized for growth. For example, with the ongoing socioeconomic and geopolitical uncertainties, inflation has become increasingly prevalent. This will impact the healthcare sector and its adjacent industry—the insurance sector at large. This not only impacts consumers but also businesses. As the cost of healthcare is on the rise, and the need for comprehensive care has stepped up tremendously, we see an opportunity for us to reimagine the healthcare journey and build an end-to-end integrated solution.
Furthermore, as businesses are struggling to recover postpandemic, there has to be avenues for collaboration and support in the ecosystem, particularly in cultivating a stronger playing field for digital innovation.