Ethics Symposium speaker: Ethical leadership is good for business

Olafson Ethics Symposium examines ethics and responsibility through lens of COVID-19, social turbulence

Chris Hilger, CEO, president and chairman of Securian Financial, was they keynote speaker for this year’s Olafson Ethics Symposium hosted by the Nistler College of Business & Public Administration.

Put yourself in the shoes of Chris Hilger back in March of this year. Hilger is the president, chairman and chief executive officer of Securian Financial, a major life insurance company.

The global COVID-19 pandemic was taking hold in the United States. Hilger and his leadership team were facing many uncertainties, given the trillions of dollars they manage in insurance policies.

Those uncertainties presented many decisions that had to be made in a short amount of time. Does the company batten down the hatches by restricting payouts to customers, or do the opposite: streamline claims processing despite the short-term effect on profits?

Influenced by a clear set of values held by the company since its founding, Hilger chose to put people before profits – an approach that, in his estimation, will both serve customers and be good for business in the long run. And just two months later, after the killing of George Floyd mere miles away from Securian’s St. Paul headquarters, the company would face yet another major test of its ethics and sense of responsibility.

Such were the topics of the Olafson Ethics Symposium at UND, held virtually for the first time in its 16-year history on Thursday. Hilger connected via Zoom from the Twin Cities to talk about business ethics in times of crisis as a keynote for the annual speaking engagement, which is hosted by the Nistler College of Business & Public Administration.

Nistler College Dean Amy Henley led the event, which started with a presentation by Sean Valentine, Chester Fritz Distinguished Professor of Management, as well as an introduction from Symposium benefactor Bob Olafson.

“We are so grateful to have the opportunity to continue to provide this signature event in a new digital format,” said Henley. “The college is committed to experiential opportunities for our students and this important discussion on ethics is an essential aspect of our foundation at the Nistler College.”

Olafson, who earned degrees in mathematics and business administration at UND, remarked that he has known Hilger since the now-CEO joined Securian in 2004. Notably, Olafson spent his entire 40-year insurance career at Securian Financial, where he retired as Senior Vice President of Group Insurance in 2012.

“Chris has always carried a strong commitment to treating others with respect and dignity, and to supporting the people and communities touched by the company,” Olafson said.

Bob Olafson, who earned two degrees from UND, spent his entire 40-year career with Securian Financial, where he retired in 2012 as Senior Vice President of Group Insurance. Olafson has supported the ethics-focused speaker series since 2005 and spoke before Thursday’s keynote.

Strength through values during tough times

Immediately following Olafson’s introduction, Hilger said that when Olafson asked him early this year, he couldn’t refuse his former colleague’s request to participate. But back then, nobody could have anticipated what the ensuing months of 2020 would bring.

“As this year unfolded, today became a great opportunity to talk about being ethical in times of crisis,” Hilger said.

Over the course of an hour, the executive provided an inside look into how Securian Financial addressed COVID-19, as well as the broader challenges of corporate social responsibility.

Speaking of corporate social responsibility, Valentine’s preceding presentation helped attendees – who included many of the College’s students – understand the meaning of such a term.

Sean Valentine

“Corporate social responsibility is a responsibility to act beyond the economic and legal obligations of operating a business, to positively contribute to society,” the professor explained. While it’s one thing to recognize the basics of regulations and finances, it’s another to take on the more discretionary steps of being socially responsible, Valentine said.

Hilger said that he has been motivated not only by the values of colleagues such as Olafson, but also by the aforementioned values the company has embraced since 1880, including trust, respect, integrity and quality in “helping customers build secure tomorrows.”

Leading the eighth biggest insurance company in the United States, Hilger referred to such values as the company’s “North Star” that put Securian in a position of strength during crises such as COVID-19.

Even so, the mounting uncertainties and pressures presented by the pandemic demanded a more specific set of crisis management principles to guide a fast, intense and high-stakes period of executive decision-making.

Hilger laid the principles out in three points: “Take care of the people who count on us; protect our financial strength; prepare for the future,” he said.

Purposefully, Hilger said, there wasn’t any focus on short-term profitability in Securian’s approach. It was a situation in which the company needed to meet immediate challenges and live up to stakeholders’ expectations that had been built over generations – stakeholders being employees, managers, regulators and customers alike.

In valuing Securian Financial’s stakeholders over short-term profits, Hilger said the company has stayed true to its founding principles and has made decisions in 2020 that will benefit the company long-term. Zoom screenshot.

Securian Financial ramped up customer service resources to help the company’s policy holders, providing a comfort to the many who had urgent questions, Hilger said. The company also offered leniency on payments, and provided timely benefit checks to customers. These decisions contributed to an additional $150 million in paid benefits due to COVID-19.

“The products our customers buy aren’t something they can touch or use, and they hope they never have to use them,” Hilger said. “But we’re providing a promise that we’ll be there should they need us.”

Faced with the task of ramping up such services with 95 percent of the company’s workforce working from home, few expenses were spared in preparing his employee base for a rapidly changing work-life environment, Hilger said.

For example, without laying off or furloughing employees, Securian provided two weeks of additional paid leave for those impacted by COVID-19, covered costs of testing, and provided a $500 stipend to improve workspaces at home. This was all in addition to a huge tech effort to make sure employees could carry out their work remotely.

The company also donated around $1.5 million to local food banks and small businesses, and made a sizable donation of masks to the state’s nurses association.

“We take a lot of pride in how we can support our customers and families,” Hilger said. “Our business is all about protecting futures, so there is no surprise that our motivation was to support our stakeholders.”

Changing expectations for businesses

“Then tragedy struck on May 25, with the killing of George Floyd,” Hilger remarked. “The aftermath of this was devastating for the community, and I knew we needed to do something for people to take our values seriously.”

Shortly after the incident sparked global protests and unrest, Hilger wrote company-wide statements in a way that acknowledged both systemic racism and the need for Securian Financial to be part of addressing society’s failures.

Hilger addressed questions read by Nistler College Dean Amy Henley following his keynote presentation.

Later during Thursday’s symposium, when fielding questions from Dean Henley, Hilger said expectations are changing for how businesses handle corporate social responsibility. When he was starting out, businesses weren’t expected to weigh in on current events. Now they are, and the calls are coming from both inside and outside the corporate structure.

“We have important internal pressure from our employees and board of directors, who set the tone, and we feel pressure from customers’ and regulators’ expectations,” Hilger said. “It’s a good pressure to have, to live up to our principles. We should be committed to keeping pressure up, and accepting of it.”

Even more important than the statements made by the CEO, chairman and president following Floyd’s killing was follow-through. Among other initiatives, that included increased education efforts for employees in the form of informative listening sessions and a book club series – both of which Hilger has taken part in and learned from.

“The second area in following through was supporting equity,” Hilger said. “In contributing to closing the education and achievement gap, we donated $500,000 toward such causes and we’re tackling structural issues in our own company.”

He acknowledged that social justice is an issue that has been around far longer than Securian Financial, but the conversations seem different and more productive these days, he said. During crises, it becomes easier to see how committed people are to the values and purposes of their organizations, Hilger said. When a company leans into what they proclaim, it can be an incredible source of strength during difficult times.

“Positive change is coming our way, as well as big challenges to us as individuals, organizations and communities,” Hilger said. “If our movements are motivated by our principles, we’ll discover that it’s good for business.”

The Olafson Ethics Symposium at the University of North Dakota is supported by Bob Olafson, with additional funding provided by SEI Investments.