CRIMINAL CAPITALISM #GAAP***From Enron to Wirecard – Big 4 Accounting Firms Still Face Systemic Problems

By Ellen Milligan and Hugo Miller | July 2, 2020

INSURANCE JOURNAL


Two decades of financial disasters from Enron Inc.’s collapse in 2001 to Wirecard AG’s meltdown have left the Big Four accounting firms facing a major cultural problem that regulators may struggle to resolve.

The 1.9 billion euros ($2.1 billion) missing from Wirecard’s balance sheet brought the chief executive officer’s arrest, the German payments firm’s insolvency filing and a lot of finger-pointing. Some have blamed German regulator BaFin for its oversight failures. Wirecard’s auditor, Ernst & Young, called it an “elaborate” fraud that even a very rigorous probe may not have discovered.

Allianz Ends Relationship with Wirecard Amid Accounting Scandal

SoftBank May Sue Wirecard Accountant EY; EU Probes Germany’s Regulator

‘The Money’s Gone’: Wirecard Collapses Owing $4 Billion

Former CEO of Wirecard Arrested in Accounting Scandal Involving Missing $2.1 Billion


But EY is also on the hot seat. It was added to a class-action style lawsuit against Wirecard on Tuesday, and stands accused of failing in its most fundamental duty. It’s a systemic problem facing not just EY, but also the other members of the Big Four: KPMG, Deloitte and PriceWaterhouseCoopers, according to Atul Shah, an accounting and finance professor at City University of London.

“After the 2008 crash, hardly any auditor was fined or went to jail over their failure to warn society,” Shah said. “After that it got worse — the common factor is the cultural problem.”

The Big Four have each developed lucrative advisory arms to compete with McKinsey & Co. and other firms to provide the opportunity for revenue growth and brand building that accounting doesn’t. However, regulators say that creates an inherent conflict of interest and encourages the auditors to be restrained in their audits to protect consulting opportunities.

Now EY’s role as Wirecard’s accountant has prompted German politicians to blast their country’s regulators and to join their British counterparts in calling for the Big Four to be broken up.

EY is “committed to a multidisciplinary model” because it provides the “technical skills and industry expertise necessary to deliver high-quality audits,” as well as the resources to invest in technology, the firm said in a statement. “Quality audits depend on a broad team with diverse skills, delivered with a culture based on shared values,” it said.

Deloitte has been “consistent in our support for reform,” the firm’s deputy CEO, Stephen Griggs, said. “We remain committed to playing our role in delivering change that embraces audit quality, improves choice and restores trust.”

KPMG and PwC declined to comment.

BaFin has already come under fire after it took more than a year to report Wirecard for suspected market manipulation following a tip-off from a whistle-blower about irregularities at the payments company. BaFin chief Felix Hufeld issued an apology, saying that it shared responsibility for the “complete disaster” at Wirecard because it didn’t do a good enough job as a regulator.

Fabio de Masi, a leader of Die Linke party in the German Bundestag, has demanded a “comprehensive reassessment” of BaFin’s role.

Sven Giegold, a German member of the European Parliament, has called for the legislative body to open an investigation into Wirecard. He’s also asking the European Commission, the EU’s executive arm, to review its rules on auditing.

“We have to end the wrong incentives for statutory audits,” Giegold said, adding that “audit firms have to be fully separated from advisory business.”

Even if the Wirecard scandal has shaken Germany’s financial sector, critics in the U.K., where the Big Four have a big presence, have been calling for reform for nearly a decade to little effect. That may be because the companies’ influence with regulators is too strong to allow a breakup.
Political Clout

“The audit regulatory landscape has few neutral voices,” said Karthik Ramanna, a professor of public policy at the University of Oxford, pointing to former Big Four accountants who take roles with the regulatory bodies. “Alumni abound.”

A number of former partners at the Big Four firms sit on committees at the Financial Reporting Council, the U.K.’s industry watchdog.

Anne Whitaker, former head of audit and risk partner for EY’s U.K. financial services practice, chairs the FRC’s Audit Quality Review committee. John Hitchins, who spent 26 years as a partner at PwC, mostly specializing in bank audit and advisory services, and former KPMG partner Sean Collins, also sit on the conduct committee with her.

Paul George, who up until this year was the FRC’s executive director for corporate governance for 16 years, had previously been a partner at KPMG for 17 years, according to his LinkedIn entry.

The FRC said it has strict rules about members or former members of the profession sitting on its committees and is transparent on such matters. The law requires that no accountant or auditor can sit on a regulatory board within three years of leaving the profession, it said via email.

Michael-John Albert, who works on the delivery of audits at EY, and Veronica Poole, a senior partner at Deloitte, are members of the FRC’s corporate reporting council, an advisory panel without decision-making power. Councils include current professionals to give up-to-date insights, and are subject to the same conflict of interest rules, the FRC said.

Still, the influence of industry members is a force, experts say.

“They have become very big political operators and have captured the regulatory process,” City University’s Shah said.

EY’s German unit said that Wirecard provided “false confirmations and statements” about escrow accounts and that “even the most robust and extended audit procedures may not uncover a collusive fraud.”

All of the firms have grappled with their own scandals in the last decade, many of which remain under investigation.

Last month, the FRC reprimanded KPMG after the firm admitted shortcomings in three years of work for a client, which had to restate its distributable reserves twice. The U.K. watchdog last week ordered a probe into PwC and EY’s work for defunct London Capital & Finance Plc.

Last year, Deloitte was fined 4.3 million pounds ($5.3 million) for its failure to properly audit the accounts of a unit of Serco Group Plc.

The FRC already said in April that its plans to force a split of the Big Four’s accounting and advisory units had been put on hold because of the coronavirus outbreak. Last week it said it’s now going “to move forward” with the plan to “achieve operational separation of audit practices,” and would implement that plan as soon as next year.

Accounting experts are skeptical.
Virus Impact

“A few months ago the threat of seismic government action seemed more credible but COVID has put a pause to that for now,” said Michael Willis, director of the University of Cambridge’s master of accounting degree program. “I don’t think we’ll see a lot of regulatory change in the short run because of the COVID volatility.”

There is precedent. When Enron, the world’s largest energy trader, collapsed in a fraud of as much as $40 billion in 2001, Arthur Andersen was convicted for obstruction of justice for its role in destroying documents that were part of its audit. It became the first large global accounting firm to be shut down and the “Big Five” became the “Big Four.”

“Post-COVID, if the world settles down to a world of tranquility, then it’s doable,” said John Gilligan, director of the Said Finance Lab in Oxford, and a former partner at Deloitte.

“But if you’re sailing a ship in a storm, you need to bring it into anchor in harbor before you can do any repairs.”

–With assistance from Karin Matussek.

*** GENERALLY ACCEPTED ACCOUNTING PRACTICES.

Copyright 2020 Bloomberg.

‘G4’ Swine Flu Virus Is Not New, Does Not Easily Infect Humans: China
July 6, 2020

SHANGHAI/BEIJING – China’s Ministry of Agriculture and Rural Affairs said on Saturday that the so-called “G4” strain of swine flu virus is not new and does not infect or sicken humans and animals easily, rebuffing a study published earlier this week.

That study, by a team of Chinese scientists and published by the U.S. journal Proceedings of the National Academy of Sciences (PNAS), warned that a new swine flu virus, named G4, has become more infectious to humans and could become a potential “pandemic virus.”

Potential New ‘Pandemic Virus’ Has Been Found in Chinese Pigs, Warns Study
A new flu virus found in Chinese pigs has become more infectious to humans and needs to be watched closely in case it becomes a potential “pandemic virus,” a study said, although experts said there is no imminent threat.

However, China’s agriculture ministry said in a statement that the study has been interpreted by the media “in an exaggerated and nonfactual way.”

An analysis by the ministry concluded that sampling of the published study is too small to be representative, while the article lacks adequate evidence to show the G4 virus has become the dominant strain among pigs.

The ministry said it drew its conclusions after holding a seminar on the G4 virus’s impact on the hog industry and public health. Participants included Chinese veterinarians and anti-virus experts, as well as the leading authors of the PNAS study.


The participants concurred that the G4 virus is not new, the statement said. Furthermore, such a strain has been monitored continuously by the World Health Organization (WHO) and related agencies in China since 2011, the statement said, citing a senior WHO official.

In addition, the authors of the published study agreed that the G4 virus does not effectively replicate in the human body and cause disease, according to the statement.

The ministry’s statement was authored by Yang Hanchun, a swine viral disease scientist at China Agricultural University who also serves the role of expert on a ministry anti-epidemic committee.

(Reporting by Samuel Shen, Hallie Gu and Ryan Woo; editing by Christian Schmollinger)

Copyright 2020 Reuters. 

Potential New ‘Pandemic Virus’ Has Been Found in Chinese Pigs, Warns Study

By David Stanway | June 30, 2020 INSURANCE JOURNAL


SHANGHAI – A new flu virus found in Chinese pigs has become more infectious to humans and needs to be watched closely in case it becomes a potential “pandemic virus,” a study said, although experts said there is no imminent threat.

A team of Chinese researchers looked at influenza viruses found in pigs from 2011 to 2018 and found a “G4” strain of H1N1 that has “all the essential hallmarks of a candidate pandemic virus,” according to the paper, published by the U.S. journal, Proceedings of the National Academy of Sciences (PNAS).

Pig farm workers also showed elevated levels of the virus in their blood, the authors said, adding that “close monitoring in human populations, especially the workers in the swine industry, should be urgently implemented.”

The study highlights the risks of viruses crossing the species barrier into humans, especially in densely populated regions in China, where millions live close to farms, breeding facilities, slaughterhouses and wet markets.

The current coronavirus sweeping the world is believed to have originated in horseshoe bats in southwest China and could have spread to humans via a seafood market in the central city of Wuhan, where the virus was first identified.

The World Health Organization (WHO) will read the Chinese study carefully, spokesman Christian Lindmeier told a Geneva briefing on Tuesday, saying it was important to collaborate on findings and keep tabs on animal populations.

“It also highlights we cannot let our guard down on influenza and need to be vigilant and continue surveillance even in the coronavirus pandemic,” he added.

Chinese Foreign Ministry spokesman Zhao Lijian told a daily news conference on Tuesday that China was closely following developments. “We will take all necessary measures to prevent the spread and outbreak of any virus,” he said.


The study said pigs were considered important “mixing vessels” for the generation of pandemic influenza viruses and called for “systematic surveillance” of the problem.

China took action against an outbreak of avian H1N1 in 2009, restricting incoming flights from affected countries and putting tens of thousands of people into quarantine.

The new virus identified in the study is a recombination of the 2009 H1N1 variant and a once prevalent strain found in pigs.

But while it is capable of infecting humans, there is no imminent risk of a new pandemic, said Carl Bergstrom, a biologist at the University of Washington.

“There’s no evidence that G4 is circulating in humans, despite five years of extensive exposure,” he said on Twitter. “That’s the key context to keep in mind.”

More than 10.3 million people have been reported to be infected by the novel coronavirus globally and 504,269 have died, according to a Reuters tally.

(Reporting by David Stanway; additional reporting by Cate Cadell in Beijing and Emma Farge in Geneva; editing by Richard Pullin and Nick Macfie)
Photo credit: INA FASSBENDER/AFP via Getty Images
Copyright 2020 Reuters. 

KISS

Return-to-Work Safety: Employers Find Testing Employees More Trouble Than It’s Worth

 TROUBLE SPELLED $$$$$$$$$$$$$$$$$

By Christopher Palmeri, Emma Court and Angelica LaVito | July 6, 2020
INSURANCE JOURNAL


From nursing homes in New York and a landfill in Utah to Disney World and the Las Vegas Strip, employers are wrestling with workplace safety in the age of Covid-19 and making fraught calculations about how to safeguard both their businesses and their employees.

Mass testing, a critical tool to stem the virus’s spread, would appear an obvious solution.

But dogged by issues of cost — diagnostic tests start at around $100 each — access, logistics and employee privacy, tests aren’t part of most back-to-work plans. As health-care companies that work with employers in this capacity are fond of saying, there’s no silver bullet.Another major deterrent is that Covid-19 tests only measure that point in time, notes Lauren Vela, senior director for the Pacific Business Group on Health, which represents large employers like Microsoft Corp. and Walmart Inc. If a worker is infected shortly after being tested, it wouldn’t show up but everyone would be falsely reassured by the negative result.

Testing is “not really available, feasible or easy, and it’s not a solution you can do for every employee, every day,” Vela said.

So instead employers are favoring lower-cost, easier-to-implement interventions like temperature checks and symptom screening while also stocking up on masks, hand sanitizer and cleaning wipes. While those measures help, asymptomatic individuals could still transmit the virus.

Health-care startup Buoy Health has been working with employers on Covid workplace issues. Only a few are taking an on-site testing approach.


“The cost of the test at scale is pretty prohibitive,” Chief Executive Officer Andrew Le said.

But at Walt Disney Co. theme parks, actors working the live shows are demanding screenings before they return.

Performers sing, dance and hand things to each other, noted Kate Shindle, president of the Actors’ Equity Association, the union that represents cast members at Broadway shows and Disney’s Florida resorts.

“There’s lot of people who can do their work when they’re wearing a mask and gloves. Our people can’t do that,” Shindle said in an interview. “It’s just very important to our membership, who otherwise is overwhelmingly eager to get back to work.”

In a June 24 letter to its unions in California, Disney said it doesn’t think testing is a good idea, citing a high rate of false negatives and concerns that it creates “a false sense of security,” among other factors. Instead, it’s focusing on physical distancing, wearing effective face coverings, hand washing and sanitization.

‘Not in Control’

Intermountain Regional Landfill in Utah, located about an hour’s drive from Salt Lake City, has made a different calculation. Cases in the state have surged in recent weeks and an employee recently had to stay home for three days because of a potential exposure through a family member who ended up testing negative.

That was “not only cumbersome and a loss of productivity, but really frustrating to know we’re not in control of it,” said Chief Financial Officer Adam Campbell.

Workers operate bulldozers to move trash at the Intermountain Regional Landfill in Fairfield, Utah. Photographer: Kim Raff/Bloomberg

Intermountain processes over four million pounds of waste a day and operations are easily disrupted even if only a few workers got sick. In the worst-case scenario, should infection hit all 15 employees and force a total work suspension, the business would face estimated losses of about $20,000 a day.

So Intermountain decided to test its workforce. It’s working with Atlas ID, a software company that had focused on employment verification systems before the pandemic, to work out how often to test and in which scenarios. It’ll cost about $2,000 a round.

Exclusive Coronavirus Survey: P/C Insurance Return to ‘Normal’ Office May Take Time

Many property/casualty insurance professionals, most of whom have been working at home during the pandemic, may need some convincing not only to return to an office anytime soon but also to engage in typical business activities with colleagues and customers.

Three-quarters (75%) say their firms have safety plans for a return to the office by employees. These plans include social distancing, mask requirements, staggered shifts, reconfigured workstations and other measures. Read more.

“We could be testing for years at a high level and never even touch just missing one day’s worth of having to divert our waste,” Rob Richards, the landfill’s president and general manager, said.

Insurance Help?

At nursing homes and assisted living facilities, which an analysis by the Foundation for Research on Equal Opportunity found account for 45% of virus deaths in the U.S., testing employees is mandatory for many. But the bill quickly adds up.

Len Russ owns Bayberry Care Center in New Rochelle, New York. His roughly 100 employees were tested twice a week for five weeks, at a cost of $20,000 a week. The screening did identify at least six sick employees, but Russ is still waiting to see how to cover the $100,000 tab. The lab that processed the tests will try billing employees’ insurance, though Russ said he doesn’t expect them to cover repeat testing.

Keene Valley Neighborhood House, an assisted living facility in upstate New York, has had success billing insurance, according to executive director Richard Rothstein. But employers are ultimately likely to bear these costs themselves through higher premiums.

Employers, many of whom are already facing massive losses from shutdowns, often find the cost doesn’t make sense. Antigen testing, which screens for active infections and provides rapid and cheap results, has promise but is only beginning to come to market.

Although antibody tests, which screen for past infections and are easier for labs to scale up, seemed like a solution, it isn’t clear what sort of immunity antibodies grant. And after the Centers for Disease Control and Prevention said antibody tests shouldn’t be used in deciding to send people back to work, the Equal Employment Opportunity Commission issued a statement telling employers they can’t require the tests. Diagnostic tests for current infections are permitted.



South of Los Angeles, EB Design builds decorative interiors for hotels and high-end restaurants, a group that was “basically decimated” during shutdowns, owner Eric Beneker said. He decided to test his 20 employees biweekly to ensure their safety, but couldn’t find information or resources on how to do it.

The company ended up booking appointments through facilities set up by local governments. It’s been time-consuming, though, as there were few open slots and long turnaround times. And they had to mislead the sites to get in because individuals have to be symptomatic to get tested.

“Is it the honest thing to do?” Beneker said. “Probably not, but we don’t have any other choice, and we’re not given any other choice.”

In May, two employees tested positive and EB Design closed down. The company paid a private lab to re-test everyone. It cost about $3,000 total, around 10% of the company’s payroll. It turned out neither had Covid-19. Could the company field that kind of bill regularly? “Hell no,” Beneker said.

“The problem is we’re so far down the road here with reopening of the economy,” he said. “While we’re trying, and we’re doing our best, we’re not getting the tools” needed to help.

Logistical challenges abound — results often take days or over a week to come in, supplies continue to be limited — but privacy issues often weigh as heavily.

Suffolk Construction partners with Buoy Health on its workplace safety plan. A testing facility is available as needed, but the builder isn’t implementing mass screenings, Executive Vice President Alex Hall said, citing privacy concerns and the limited usefulness of the results.

“We get it. There’s an element of Big Brother around this situation anyway,” Hall said. “We want to be mindful of how people are feeling.”

The battle is also playing out in Vegas, where cases have surged since casinos began reopening last month.

The Bellagio Hotel and Casino in Las Vegas reopened on June 4.

 Photographer: Joe Buglewicz/Bloomberg

Managers, unions and other business leaders created a program with a hospital to test workers at the convention center. But it isn’t mandatory, according to Bethany Khan, a spokesperson for the Culinary Workers Union Local 226, which represents casino employees.

While Caesars Entertainment Corp. has made testing mandatory after a worker died from the virus in June, others haven’t. Khan said the union is pushing for regular testing and on Monday, it sued Harrah’s hotel, operated by Caesars, and MGM Resorts International’s Bellagio for not adequately protecting workers.

MGM said it’s working with health-care professionals to develop safety protocols, including mandatory testing for anyone with symptoms or exposure, as well as free ones for anyone who wants a test. “Nothing is more important to us than the safety of everyone inside of our properties,” the company said.

At a press conference last week, a bellman at The Signature at MGM Grand hotel spoke about falling ill in June.

“It was three months that we did social distancing, that we did lockdown in Las Vegas,” Sixto Zermeno said. “I go back to work, three days later I’m sick on the fourth day.”

Top Photo: Disneyland Resort reopened in Hong Kong on June 18 after shutting down for five-months. Photographer: Lam Yik/Bloomberg

Copyright 2020 Bloomberg.

Climate Change Litigants Argue Human Rights, Consumer Harm in Suing Oil Firms

By Matthew Green, Valerie Volcovici and Emma Farge | July 6, 2020
INSURANCE JOURNAL



LONDON/WASHINGTON/GENEVA — Climate change may be having its day in court.

With the slow pace of international climate negotiations, lawyers from Switzerland to San Francisco are increasingly filing lawsuits demanding action.


And they are getting creative — using new legal arguments to challenge companies and governments before a judge.

Two decades ago, only a handful of climate-related lawsuits had ever been filed worldwide. Today, that number is 1,600, including 1,200 lawsuits in the United States alone, according to data reported Friday by the London School of Economics.

“The courts are an increasingly important place for addressing the problem of climate change,” said Hari Osofsky, the dean of Penn State Law and the School of International Affairs.

Already, climate campaigners are seeing glimmers of success.

In the Netherlands in December, the country’s Supreme Court upheld a ruling in favor of the Urgenda campaign group’s demand that the Dutch government move faster to cut carbon emissions.

And in January, a judge in Switzerland acquitted a dozen climate protesters from trespassing charges, filed after the group staged a tennis match within a branch of Credit Suisse in 2018 to draw attention to the bank’s fossil fuel loans. Defense lawyers had argued that the protesters’ actions were necessitated by the “imminent danger” posed by climate change. The ruling was met in court with a standing ovation.



“It was an exceptional ruling,” one of the defense lawyers, Aline Bonard, told Reuters. Given that the protesters admitted to trespassing, “the infraction is undeniable.”

U.S. cities and other parties are challenging the fossil fuel industry for its role in causing climate change and not informing the public of its harms.

But cases like these suggest a shift in how people are understanding the role of the judiciary in mediating cases related to the warming climate. Now, “there is bound to be a new wave of legal proceedings using a similar line of argument,” Bonard said.

NEW LEGAL TACTICS

As rulings that compel governments to cut emissions remain rare, lawyers still see promise in targeting large, polluting companies. Such cases in the past tended to accuse coal-fired power stations or government of failing to limit emissions. Cases now are being fought on arguments such as consumer protections and human rights.

This shift been especially pronounced in the United States, where more than a dozen cases filed by states, cities and other parties are challenging the fossil fuel industry for its role in causing climate change and not informing the public of its harms.

Last month, both Minnesota state and the District of Columbia filed lawsuits alleging that oil majors had misled consumers on how using their products involved releasing carbon emissions and contributing to climate change.

Those cases followed another filed in October by Massachusetts, which also used consumer protection arguments in suing Exxon Mobil Corp. All three accused the oil companies of engaging in deceptive practices and false advertising.

“As awareness of climate change grew in the general public to the extent that their disinformation campaigns were no longer acceptable, there was a pivot to greenwashing,” Kate Konopka, Washington D.C.’s deputy attorney general, told Reuters.

In each case, most of the companies denied the allegations. BP Plc declined to comment.

Exxon said the Washington D.C. lawsuit was part of a “coordinated, politically motivated” campaign against energy companies and was without merit. Chevron Corp also dismissed the D.C. case, saying the litigation “distracts” from its efforts to address climate change.

Royal Dutch Shell Plc said it was “committed to playing our part” in addressing climate change, but that lawsuits “impede the collaboration needed for meaningful change.”

But companies appear to be worried. The National Association of Manufacturers formed a group in 2017 to push back against “activist lawyers” for trying to scapegoat energy manufacturers.

The group, called the Manufacturers’ Accountability Project, applauded a December ruling in New York clearing Exxon Mobil of securities fraud charges, after it was accused of failing to inform investors about what it knew about climate change.

“Courts are rejecting this misguided and misleading narrative, with a federal judge already calling them ‘hyperbolic’ last year when New York’s attorney general brought claims based on essentially the same allegations,” said Phil Goldberg, a lawyer representing the group.

PRESSURE CAMPAIGN

On the human rights front, there were only five lawsuits using these arguments before 2015. Since then, there have been 40 more, said LSE report co-author Joana Setzer, an assistant professor at the London School of Economics’s Grantham Research Institute on Climate Change and the Environment.

The climate cases could work toward weakening the lobbying power of the fossil fuel industry.

Not all of these new tactics have worked out, though.

In a high-profile decision in January, the 9th Circuit Court of Appeals in San Francisco dismissed “Juliana v. United States,” in which 21 youths had accused the federal government of infringing on their rights to life and liberty by perpetuating an economic system fueling dangerous climate change. Judge Andrew Hurwitz said he had “reluctantly” concluded that the issue was a matter for the executive and legislative branches.

Whether or not a judge rules in favor of climate interests, legal experts say the momentum of having so many cases before courts is serving to underline the urgency of the climate issue for both the public and policymakers.

“We need massive government intervention to get us out of the hole that we’re in, which makes government a primary target,” said Tim Crosland, director of British climate litigation charity Plan B.

The group was part of a campaign that successfully sued to block a third runway at London’s Heathrow Airport, with Britain’s Court of Appeal agreeing in February that the plan had failed to consider the country’s commitments under the 2015 Paris climate accord. That decision is now awaiting a final appeal.

Richard Wiles, executive director of the D.C.-based Center for Climate Integrity, a non-profit organization supporting climate litigation, said the tumble of climate cases would work toward weakening the lobbying power of the fossil fuel industry.

“Just as you wouldn’t expect tobacco companies to be at the table when we’re deciding pubic heath policy, the notion that the oil industry would dictate climate policy doesn’t hold water,” Wiles said. “They are just not going to have the same ability to dictate climate policy that they did in the past.”

(Reporting by Matthew Green in London, Valerie Volcovici in Washington and Emma Farge in Geneva; Editing by Katy Daigle and Lisa Shumaker)


Copyright 2020 Reuters.

Measuring the Moment: How Will George Floyd’s Death Matter to Insurance Industry?
By Andrew G. Simpson | June 10, 2020
INSURANCE JOURNAL


The marches and protests across the globe sparked by the death of George Floyd by Minneapolis police are presenting the country with opportunities to confront the racism and inequality that African-Americans confront every day.

As executive director of the National African American Insurance Association, Margaret Redd works every day to create and expand opportunities for African-Americans in the insurance business.

According to Redd, the “significant amount of attention being given to the plight of African Americans” across the globe is unprecedented.

“There’s never been a moment like this. I think most people would agree with that. And so what we do at this moment is yet to be seen,” commented Redd.

Redd is impressed that it is not just African-Americans calling for change but a “very diverse group and audience of people” embracing the need for change.

The attention may be historic but will it matter to the insurance industry?

Redd sounds like a person with doubts. For while she is quick to praise honest intentions and efforts, she is also critical of the scarcity of tools for measuring what is happening that could reveal if real progress is indeed being made for blacks.

She asks why more corporations don’t treat increasing black employment like they treat other strategic goals by obtaining C-suite and board buy-in, setting measurable objectives, and holding people accountable.



And she has witnessed how some corporate diversity and inclusion efforts tout progress on hiring and promoting more women but are silent on blacks.

Margaret Redd

According to 2016 data from the Bureau of Labor Statistics, African-Americans make up 11.9% of the country’s total workforce and 11.1% of the insurance workforce. Blacks fare a bit better in the claims area—15.1% of adjusters are African-American— but a bit worse in underwriting— 9.6% of underwriters are African-American.

In banking, 11.5% of the workforce is African-American, 10.4% in real estate, 10.4% in professional services, 14.3% in food manufacturing, 12.3% in retail, 20.1% in transportation/utilities and 15.1% in education and health, according to the same BLS data.

According to a 2018 study from the Independent Insurance Agents and Brokers of America, only 2% of established agencies have at least one African-American principal. However, about 13% of agencies established within the last five years have at least one. Overall just 4% of all independent agencies have an African-American principal or senior manager— compared to the 88% with white agency leadership.

“There’s never been a moment like this. I think most people would agree with that. And so what we do at this moment is yet to be seen.” –Redd

Journey to 2018

In the spring of 2018, global insurance broker Marsh commissioned a research project to examine the experiences of African-Americans working in the insurance industry. The main goal was to understand how to get more blacks employed in the insurance industry.

The research was conducted by Dr. Leroy Nunery III, a human resources, education and management consultant and founder of Plus Ultre. The project was under the direction of Alex Amonett, Global Inclusion, Diversity & Colleague Experience Leader for Marsh.

The resulting report, “Journey of African-American Insurance Professionals,” reflected participation by members of Redd’s NAAIA group. The primary research included 312 online survey responses, 25 interviews, and seven focus groups conducted over a six-month period prior to its publication in September 2018.

When asked if there are greater obstacles for African-Americans in the insurance industry compared to those for other minorities, 70% of those surveyed for the report either strongly agreed or agreed.

Participants ranked the key barriers to entry into the insurance business by African-Americans as: lack of exposure to the industry; lack of networks; lack of experience; racial bias; lack of educational preparation and gender bias.

“Anecdotally, I don’t think the dial has moved very much.” –Redd

Race would often be a factor in hirings, promotions and new assignments, as well as in whether they were included in key meetings, social events or opportunities with customers, according to those surveyed.

The report included comments from African-Americans in the industry talking about their experiences with racism and racial bias, both overt and subliminal, and talking about how race has affected their individual career journeys.

Alex Amonett

“I believe the level of unconscious bias that exists for African-Americans leads more people to react adversely towards this particular race of people,” said one participant. “We are often starting from way below benchmark before we even begin to engage with a business partner, client, or colleague, and therefore have to spend a lot of energy disproving their bias before we can even get down to the business of what we came here to do.”

“Rarely do I encounter overt racism,” said another participant. “Most of the time it’s people’s implied biases that hold African Americans, females, and people of color back. Usually, the top of the house (senior management) says all the right things, but it doesn’t get practiced at the middle management level.”

“Tell You What I See’

Flash forward from 2018 to the death of George Floyd in 2020, a time of heightened racial tensions along with, until recently, a strong economy with high employment figures (before the pandemic hit).

“I think the bigger picture here is this is not something that’s going to disappear tomorrow or in a couple of weeks, months or even years.” — Amonett

Did the 2018 report help? Do the people involved in it think there has been any progress towards the goal of increasing the number of African-Americans in insurance?

While she values the 2018 study and the support that Marsh has given her organization, NAAIA’s Redd questions whether real progress has been made in attracting more African-Americans into the industry.

“When we look for quantifiable measures, I just don’t think that we can give you that,” she said candidly. “Anecdotally, I don’t think the dial has moved very much.”

She said she does not see progress when she looks for African-American diversity in the C-suite, when she looks at insurance executives and leaders. “I don’t think the dial has moved very much and, in some cases, it might have moved back a bit.”


Further Strategic Thoughts

Becoming more technology-focused may help attract more blacks to the insurance industry.

“We have a larger diversity demographic within our tech side of the business,” said Marsh’s Amonett.

NAAIA’s Redd said her group has been holding national talent competitions to show off the technology side of the business. They choose subject matter that is “interesting, whether it’s drone technology or the internet of things or cyber threats. It’s the stuff that you hear about all over, not just in relation to insurance.”

Redd thinks the trend toward more remote work, accelerated due to the pandemic, may also open some doors. “I think that that is an opportunity in general” but not one that is necessarily “going to make a specific difference within the African American community,” she said.

She thinks in general the flexibility of remote work could make a difference for companies in terms of their ability to attract and retain employees. Employers with greater flexibility are going to appeal to a greater number of people, she suggested.

Amonett is cautious about the effect of remote working on recruiting blacks, maintaining that networking has been a challenge for African-Americans in the industry and “virtual networking” may make things even more difficult. It will require employers to have more deliberate processes to connect diverse talent to the organization, he said.

*********

The 2018 report commissioned by Marsh, “Journey of African-American Insurance Professionals,” offered strategies for blacks interested in working in the industry. These included being willing to take on risks of new assignments, pursuing professional development licenses and certifications, developing relationships within and outside of the industry and being their own career manager and advocate.

The participants recommended that African-Americans take advantage of mentorships, on-the-job training, leadership development programs and membership in professional organizations in order to progress from trainee to executive level positions.

The report also offered strategies and recommendations for employers interested in improving the presence and experience of African-Americans in the industry. These included moving beyond conventional recruiting activities, obtaining a commitment from senior management, developing employee resource groups, implementing formal mentorship and sponsorship programs for blacks, and diversifying their supply chain with African-American owned companies.

She acknowledges that she has no real numbers to back up her gut feeling. “I can just tell you what I see,” she said.

Given the lack of hard metrics, Redd said she “grabs at other ways of measuring progress.”

She believes that more dialogue is happening and that NAAIA’s interaction with industry partners is stronger than it’s ever been. However, that doesn’t mean the numbers have changed. “It’s a measure; not the measure but it’s a measure,” the NAAIA executive said.

At the same time, Redd feels African-Americans still find themselves in the same place year over year over year.

NAAIA was founded in 1997 on the recognition that African-Americans weren’t represented very strongly in this industry and that there was no strong network for those who were in the industry to get to know and support one another. “The basis for which this organization was founded, that issue still persists today,” Redd said.

Marsh’s Amonett said the 2018 report has been used as a consulting tool, as a strategic guide for employers and as material for NAAIA workshops and events focused on deep discussions around systemic racism and bias and better practices around hiring black candidates. It has helped NAAIA foster better dialogue, additional engagement and attract partnerships.

He acknowledged that diversity and inclusion don’t always move at the pace he and others would like but believes that the George Floyd protests can serve to “refuel that spark in recognizing we need to be moving a lot faster than we are, and we need to be putting aside different red tape and politics that are currently getting in the way of some of the challenges.”

At the Top

Among its observations, the 2018 report stressed that if there is to be real change in diversity of the workforce, the effort must have support at the top.

Carrier Management reported on a number of insurance executives that have spoken out against police brutality and in support of the racial equality. Since the death of George Floyd. Marsh & McLennan CEO Daniel Glaser was among the first. So did CEOs of American Family, Allstate, AIG, Chubb, CSAA, Hartford, Progressive, Erie, Zurich North America, State Farm, Utica National… the list goes on.

Jack Salzwedel, chair and CEO of American Family Insurance, said society must take action on multiple levels and in new ways. “It also requires people of privilege—white people—to stand up for and stand with our communities like we never have before,” he said. “I’m privileged. I have a voice. I want to use it for good.”

“We all have to make a difference by standing with those who are being prejudiced. We need to participate in honest dialogue that bridges understanding and arrives at shared actions and responsibilities,” Chubb CEO Evan Greenberg said in an email to the insurer’s U.S. employees.

“These times are a stark reminder that our society still suffers from far too many cases of distrust, hatred and racism. This is not the world we should accept as a society,” State Farm said. “We must push ourselves to influence change and create compassion.”

Of course, not all insurance leaders heeded the message that they should have a message at times like this.

“For anyone who chooses to let this moment pass as if it’s just a fleeting thought, I think they’re totally missing the mark. It will be an unfortunate consequence to them and the business that they serve,” said Redd. She said that’s “not a threat, it’s a reality.”

“I think the bigger picture here is this is not something that’s going to disappear tomorrow or in a couple of weeks, months or even years,” said Amonett.

Amonett said he believes this moment requires firms that support real change to boost their commitment. “They have to be willing to invest the time, the money and the resources to address these issues,” he said.

The Marsh executive said that for those CEOs not speaking out, there are consequences to being silent. “You lose engagement, you lose the trust you have built with clients, with colleagues, with the community,” he said, suggesting those who do not speak out come across as being “apathetic” to what is going on.

Redd said she is encouraged by the insurance CEOs and those from companies like Uber who are speaking out and including in their messages “very specific steps” that they are taking to make a difference for the long term.

“For anyone who chooses to let this moment pass as if it’s just a fleeting thought, I think they’re totally missing the mark. It will be an unfortunate consequence to them and the business that they serve.” — Redd

“That to me is the kind of reaction that we need more of across this industry,” she said.

Plotting Progress

Counting the CEOs who speak out is perhaps not the best way to measure the commitment to change of an industry or a company. But in the real world of promoting blacks in insurance, one problem is that there are not many metrics available, according to Redd.

While some insurers may track numbers privately, a few insurance organizations do reveal more than intentions in their efforts to increase African-American representation within their ranks. American International Group is one — AIG’s website has a “percentages report” that breaks out employment by minority categories (10.4% of AIG associates are African-Americans).

Progressive Insurance reports the minority percentage of its new hires and current employees. In 2018, 27% of Progressive’s new hires were African-American, compared to 17% for current employees. It also reports on promotions by race, ethnicity and gender.

Allstate’s Prosperity Report discusses diversity and shares that 17.2% of employees are African-American.

Zurich publishes an extensive human resource factbook that explores the company’s employment by gender, generation and geography but not race.

The Independent Insurance Agents and Brokers has a task force on diversity and the organization researches and reports on the status of minority employment, including for African Americans, in insurance agency ranks. “Many agencies continue to struggle to convince an already limited talent pool that insurance is a promising career option,” wrote Alex Dopazo, chair of the IIABA Diversity Council, last February. Progress in the agency system has been “driven mostly by newer agencies that have been established within the past five years,” Dopazo added, noting (as reported above) 13% of new agencies have at least one African-American principal.

More and more employers including insurers and brokers are promoting diversity and inclusion within their organizations. They often include employee support groups for blacks and other minorities as well as supplier diversity initiatives. These efforts show a lot of movement around hiring women, gays and lesbians, disabled citizens and veterans. The Insurance Industry Charitable Foundation hosts a high-profile Woman in Insurance Conference with regional forums. While the global Festival for Diversity and Inclusion (DIVE), now in its sixth year, addresses a range of diversity issues including race and culture, gender equality is a main focus.

Insurance Journal asked if these and other D&I campaigns with women and other constituencies have resulted in blacks being overlooked compared to other minority groups.

Redd was shaking her head yes before the question was completed.

“We can track the way that we hire, the way that we promote.”– Amonett

“I would say that that’s a fact and I think that a lot of the stats would speak to that,” she said. She suggested that some companies have realized their minority goals through the selection of women rather than blacks to higher positions.

“I’m certainly happy for women but it doesn’t address the issue of African-Americans,” Redd said.

She said the support for women has come about more easily and sooner than the “the real measurable support that we need to see for African-Americans.”

Buy-In from Above

Redd wonders about commitment to African-American recruitment and support at the top. She said whenever a company is starting a new division or setting new goals, the initiatives need approval from the C-suite and the board. “They’ve got that buy-in at the top. They have a strategy, they have a plan, they have measurable objectives, they have accountability,” she said. They do what they need to do and track the results to succeed, she said.

So, Redd asked, why is a goal of hiring more African-Americans any different? “That’s my question. We struggle year over year with: how do we do it, how do we make it happen?” she said. She thinks companies should use the same mentality they would for any strategic initiative that is considered critically important to the organization.

Amonett agreed that every strategy needs measurement, adding that “sometimes you have to get creative about it.” He maintained that there are internal labor market data that can track growth with respect to diversity. “We can track the way that we hire, the way that we promote,” he said.

Whether the diversity development program helped people get promoted can be measured. Organizations can also use engagement and pulse surveys, he said.

“You should have targets in place and goals in place over a strategic amount of time,” Amonett said.

He said it can sometimes get complicated when companies equate targets with quotas. He said the challenge is to educate employers on what a true meritocracy offering equal opportunities really is within organizations where existing performance evaluation and promotional systems are rife with white male bias. People of color and women are often promoted based on performance versus potential, according to the Marsh diversity officer. However, the company then ends up with a lot of white men being seen as higher potential because they match the personalities of their white male leadership team.

Setting targets helps “knock down some of those barriers” for diverse communities, Amonett added.

Missing Reputation

It’s no secret that the insurance industry ‘s reputation has been an obstacle for recruitment among certain generations and communities. “We’re not going to be thought of off the top as a sexy, interesting industry,” admitted Redd.

But she said she doesn’t think the reputation is any worse in the black community than it is elsewhere, although years ago when redlining was occurring it probably was. The problem with insurance and the black community is not that the industry has a bad reputation but that it doesn’t have much of a reputation at all in the black community.

“We’re not going to be thought of off the top as a sexy, interesting industry.” –Redd

“If you don’t know the game, you can’t play the game,” Redd said, suggesting that African-Americans are largely unaware of the opportunities in insurance.

The industry remains a secret even though, according to the 2018 report, the overwhelming majority of blacks who have enjoyed successful insurance careers would recommend the industry to others.

Redd was asked if some of these African-American insurance professionals might feel differently today.

No, she said, because what has been on the national news is “not a wake-up call for black America” as it is for the rest of the nation. “We’ve lived this and understood this and been part of this all of our lives,” the NAAIA executive director said.

Photo: Protesters gather at a memorial for George Floyd where he died outside Cup Foods on East 38th Street and Chicago Avenue, Monday, June 1, 2020, in Minneapolis. Protests continued following the death of George Floyd, who died after being restrained by Minneapolis police officers on May 25. (AP Photo/John Minchillo)

American Companies Facing Pressure to Reveal Data on Diversity of Employees

By Ross Kerber and Simon Jessop | July 6, 2020
INSURANCE JOURNAL

American companies are coming under increasing pressure from investors to publicly disclose information about diversity among employees in the wake of nationwide protests against racial discrimination.

Many executives have pledged to champion equality in response to the Black Lives Matter demonstrations across the United States and beyond.


The goal of global investors increasingly focused on social and governance issues is to gain a common metric on racial diversity to compare companies and hold them to account on their pledges, building on a drive to improve gender equality.

The good news, they say, is that U.S. firms with more than 100 employees already gather such data for the federal government annually via a form known as the EEO-1, along with gender information.

However, the data is confidential and companies are not required to publicly release it, with some arguing it does not accurately capture the structure of their businesses.



Only 32 companies in the Russell 1000 make the information public, according to researcher Just Capital, either via the form itself or through detailed summaries.

“The EEO-1 is not the holy grail, but it’s an excellent starting point,” said John Streur, chief executive of Calvert Research and Management, an investment firm pressing executives to publicly disclose the data.


Once companies began releasing information, it would create competition to improve diversity, he added.

This was echoed by Mirza Baig, Global Head of Governance at London-based Aviva Investors, part of insurer Aviva.

“We think it’s inevitable that those data points will be disclosed and we think companies should get ahead of it.”

UNDERREPRESENTED

Companies that file the EEO-1 form, to the U.S. Equal Employment Opportunity Commission (EEOC), record the number of workers they have of each race and gender across 10 job categories, including senior officials, sales workers and technicians. The latest filings are for 2018, as the 2019 deadline was deferred to 2021 due to the COVID-19 pandemic.

The data reveals some very unequal pictures.

For instance, of 290 executives and top leaders at Uber Technologies Inc, one of the companies to publicly release the information, seven were Black and nine were Hispanic or Latino in the payroll period covering the last two weeks of 2018.

Both figures represented only around a 3% share of top positions, well below the two groups’ proportion of the U.S. population, of about 13% and 19% respectively.

At Bank of America Corp., in another example, Black people held 5% of 4,197 top-level roles as of last year, and Hispanic or Latino people held another 4%.

Measuring the Moment: How Will George Floyd’s Death Matter to Insurance Industry?

While some insurers may track numbers privately, a few insurance organizations do reveal more than intentions in their efforts to increase African-American representation within their ranks. American International Group is one — AIG’s website has a “percentages report” that breaks out employment by minority categories (10.4% of AIG associates are African-Americans). Progressive Insurance reports the minority percentage of its new hires and current employees. In 2018, 27% of Progressive’s new hires were African-American, compared to 17% for current employees. It also reports on promotions by race, ethnicity and gender. Allstate’s Prosperity Report discusses diversity and shares that 17.2% of employees are African-American. Zurich publishes an extensive human resource factbook that explores the company’s employment by gender, generation and geography but not race. The Independent Insurance Agents and Brokers has a task force on diversity and the organization researches and reports on the status of minority employment, including for African Americans, in insurance agency ranks. Read more.

The figures are broadly in line with aggregated EEOC data showing that of the roughly 900,000 people holding those top jobs across the country, about 3% were Black and 4% were Hispanic in 2018.

Companies that disclose the data, like Uber and Bank of America, show a more serious effort to improve minority representation, said Donald Tomaskovic-Devey, a University of Massachusetts professor who studies workplace diversity.

“Transparency is a prerequisite for both goal-setting and accountability,” he added.

An Uber spokeswoman said the company “is committed to investing in long-term strategies to create a sustainable pipeline of talent from historically underrepresented communities.”

Bank of America says on its website it is “focused on attracting, retaining and developing diverse talent.”

‘WALK THE WALK’

There has been a marked shift in attitudes since the protests sparked by the death of George Floyd in police custody in Minneapolis on May 25.

Companies have collectively pledged hundreds of millions of dollars and to remake their own workforce profiles.

However firms voicing support for racial equality should back up their talk by releasing their EEO-1 data, New York City Comptroller Scott Stringer says in letters being sent to 67 companies in the S&P 100.

“We’re asking companies that condemned racism to walk the walk,” Stringer, who oversees some $206 billion in retirement assets, told Reuters.

Activist investors say efforts to make diversity data public are gathering momentum, partly since this can be easier than reforms like adding social metrics to CEO pay programs or naming new board members.

For instance, at cybersecurity company Fortinet Inc’s annual meeting on June 19 – the “Juneteenth” U.S. holiday marking the end of slavery in 1865 – 70% of shares voted backed a resolution to report on its workforce diversity.

Kristin Hull, CEO of resolution sponsor Nia Impact Capital, said the vote tally – a record high among similar resolutions at U.S. companies according to the Sustainable Investments Institute – reflected the current discussion about race in corporate America.

Update: Lloyd’s of London Apologizes for Its ‘Shameful’ Role in Atlantic Slave Trade

Lloyd’s grew to dominate the shipping insurance market, a key element of Europe’s global scramble for empire, treasure and slaves, who were usually in the 18th Century included in insurance policies in the general rate for ship cargo.

Some Facts About London’s Role in Insuring the Atlantic Slave Trade

Slaves were seen as cargo by the insurance market of the time and generally included in the general insurance rate.

Lloyd’s Statement on Its Role in Slave Trade

At Lloyd’s we understand that we cannot always be proud of our past. In particular, we are sorry for the role played by the Lloyd’s market in the eighteenth and nineteenth Century slave trade – an appalling and shameful period of English history, as well as our own. In acknowledging our own history, we also remain committed to focusing on the actions we can take today to shape our future into one that we can truly be proud to stand by. Read more

A Fortinet spokesman said it planned to release its EEO-1 data.

MATCHING THE WORKFORCE

However to date, most companies have shied away from public disclosure of EEO-1 data. Executives say privately they worry about legal liability, bad publicity and attracting rivals’ recruiters if they employ many minorities.

Some argue the form’s categories such as “craft workers” or “laborers” aren’t relevant to their businesses.

Even some of the activists do not give out their data. “We have not historically published the EEO-1 forms, but we are reviewing that approach,” said Robyn Tice, spokeswoman for Calvert parent Eaton Vance Corp.

Some companies do disclose data, but on their own terms.

Just Capital counted 204 companies that disclosed some information on the gender and ethnicity of their employees as of August 2019, often in non-standard ways.

In a report on its website, for example, Starbucks Inc states that 17.5% of its executives ranked at senior vice president or higher are “People of Color.”

A Starbucks spokeswoman said it was reviewing whether to release its EEO-1 data publicly.

Others disclose little data currently, like Snapchat parent Snap Inc.

Snap CEO Evan Spiegel said in a CNBC interview on June 11 that, while it was working on providing more details, it was worried that disclosures “have actually normalized the current composition of the tech workforce,” which has few minorities.

A Snap spokeswoman said the company planned to disclose a breakdown of its employees by race and gender as the EEO-1 form outlined, but would likely use different job categories that better matched its workforce. It also plans to show additional data such as hiring rates, she added.

For an interactive version of the graphic, click here https://tmsnrt.rs/2Nq8D62.

HOW MUCH IS ENOUGH?

Calvert’s Streur mentioned Home Depot Inc as an example of a company that could expect more pressure to release its full EEO-1 data.

Nearly every year since 2005, shareholder activists have put a resolution on the idea to a vote at the retailer’s annual meeting – an uncommonly long run.

The company has opposed the resolutions. In its notice for this year’s meeting, held on May 21, it noted it began releasing certain diversity data annually in 2018.

In 2018, 48% of shares cast backed a resolution calling for the EEO-1-level disclosure. A similar resolution got 36% support at this year’s meeting, held four days before Floyd’s death.

A Home Depot spokeswoman said it was “committed to diversity and equal opportunity.” She cited a company diversity report, which states minorities made up 44% of its workforce in 2018.

American Century’s Sustainable Equity Fund was one backer of the resolution this year, according to Guillaume Mascotto, vice president for the fund manager.

He said the national conversation about race would make more shareholders likely to back calls for disclosure in the future.

“More and more investors, especially those that have a long-term horizon are going to want to see how companies are approaching this.”

(Reporting by Ross Kerber in Boston and Simon Jessop in London; Editing by Pravin Char)


Copyright 2020 Reuters.

Global development

It's time the UN faced up to its treatment of black people like me

Rosebell Kagumire

An honest conversation about race has to recognise the marginalisation and exploitation of many aid workers

Global development is supported by

About this content


Mon 6 Jul 2020
 

Demonstrators hold placards in front of the UN headquarters in New York during a protest against racial inequality in the aftermath of the death of George Floyd. Photograph: Jeenah Moon/Reuters

The global push for racial justice following the death of George Floyd in the US has resulted in a flurry of solidarity statements from within the international aid industry, including the UN.

After a shaky start, where its secretary general, António Guterres, was forced to backtrack on a note to staff that suggested they shouldn’t participate in Black Lives Matter (BLM), UN People of African Descent (Unpad) launched a survey to “allow staff to provide data, including on the extent of perceptions of systemic inequality inside the UN, its manifestations, and the responsiveness of the organisation to reports of incidents of systemic racism”.

The survey made me reflect on my experience during a short stint at a UN agency several years ago. I was on a consultancy contract (like so many young people) to formulate and drive social media campaigns. I carried my idealism to the job, and during that time worked on humanitarian crises in the Mediterranean, in west Africa during the Ebola outbreak, and in emergencies in Syria, Yemen, Iraq, Nigeria, South Sudan and Burundi.


'What does the UN stand for?': anger follows memo on anti-racism protests

But far from the rosy image of an industry “doing good”, I felt I was treated as a token black woman in a largely white male institution. I witnessed the racist treatment of black staff who were seen as diversity hires.

One case I’m aware of involved a new recruit from a conflict country who was tasked with producing a key document for the unit – a big ask for someone coming from outside the organisation. A few days in, a supervisor, a European white man, said: “If she doesn’t have my strategy by the end of the day I will put her on the next plane back.” She had literally fled that country, bullets raining, and survived as a refugee before joining the organisation.


I and others tried to use the internal system to report the abuse. We were informally advised that since we were on a consultancy contract such complaints would hurt our future opportunities.

Several years after I left the agency, the #MeToo movement drew the world to the struggle against structural sexism and the persistent unequal power that enables and sustains sexual abuse. Then #AidToo emerged, targeted at aid agencies that allowed abuse of power, sexual misconduct, sexual exploitation and a toxic environment for both aid workers and the women and girls they worked with. The revelations exposed the lack of oversight and systems of accountability in the sector.

At the time, black women and many from the global south asserted that it was disingenuous to speak about the exploitative aid sector without probing the systemic racism. Black people and people of colour, both in the industry and in the countries where most of the aid work is carried out, experience an amalgamation of abuse of power, systemic sexism and white supremacy.

But little, if anything changed, in the sector. Until George Floyd’s death, which saw an outpouring of solidarity statements with BLM. The very agencies that silenced us now tweet about diversity.

Seeing the new tone from the agencies, I shared my experience of racism in the sector, and several former and current UN employees got in touch.

“They wanted my contribution but not my voice at the table because they wanted me to act like I don’t see the injustice,” said a Haitian former colleague.

“I was the department help and made to feel that I must feel grateful to be sitting at the table. The department’s toxic culture eventually got me fired because I refused to act grateful and demanded to be treated equally and to be heard. Eventually, I was no longer allowed at the table and was silenced,” said a former colleague from southern Africa.

“There have been several reports against these white men in positions of power, but they only rotate them, nothing is done … A white intern can become your supervisor in the blink of an eye, and they will always tell you ‘budget’, but the same budget is not an issue for white people,” said a current employee.

A woman of colour who recently resigned cited among other issues “preferential treatment, bias recruitment and the obvious structural racisms”.

The “deep and sincere discussion” about racism Guterres seeks must recognise the historic marginalisation and exploitation of black people and people from the global south within its agencies.

In its 75th year, it is time for the UN to dismantle the unequal power at its heart. It’s an enormous challenge. So enormous that the UN must open itself up to outside scrutiny. Self-reflection is not enough of an intervention.

• Rosebell Kagumire​ is a writer and award-winning blogger

CULTURAL GENOCIDE

Israel Must Question Itself Over Bid To Erase Arab Identity – OpEd
July 6, 2020 Arab News 

By Arab News

By Dr. Dania Koleilat Khatib*

The streets of Tel Aviv have seen a series of recent protests aimed at stopping a project by the municipality. The project in Jaffa consists of excavating historic Muslim graves in order to build a homeless shelter for Jewish Israelis. It is part of a plan by the right-wing Israeli government to erase Arab heritage. Most importantly, it represents a blunder in attempts to encourage peaceful coexistence between Jews and Palestinians in Israel.

The Netanyahu government is pushing the Arab community into a corner by denying its rights and constantly attacking its heritage. It is emboldened by the Donald Trump White House, which basically rubber stamps all of Netanyahu’s wishes and whims, from unilaterally declaring Jerusalem to be the capital of Israel to acknowledging the annexation of the Golan Heights and proposing giving Israel a large swath of land in the heart of the West Bank, making a Palestinian state an impossibility. Though efforts to change street names have been going on for a while, they have accelerated recently. Netanyahu wants to seize the opportunity of having Trump in office and would like to set a precedent that will be difficult to reverse.

Jaffa’s contested Al-Isaaf cemetery, located next to the Ottoman clock tower, covers only 800 square meters. However, the Israeli authorities have made concerted efforts to remove the graves in a sign of defiance to the Palestinian community.

In 2018, the Israeli antiquity authorities excavated the area and found the 18th century cemetery. After the discovery, the authorities were urged to stop the excavation. In October of the same year, the Muslim community renovated the graves, reburied the bodies and added tombstones, only for them to be demolished shortly after by the municipality. Last year, the community appealed to the courts in a bid to stop the demolitions and end the project. However, a January ruling fell in favor of the municipality. Last month, the municipality, accompanied by soldiers, started the process of demolishing the cemetery. This sparked protests by the Palestinian community. Muslims and Christians alike gathered in rejection of the decision, forcing an Israeli court to halt the work until a hearing on July 22.

A delegation representing the Greek Orthodox Church visited the cemetery, with Bishop Atalla Hana saying: “Our roots run deep in this land and any assault on an Islamic cemetery is also an assault on a Christian cemetery.” The protesters were also joined by Jewish activists, including Rabbi Eliyahu Kaufman. He issued a statement in which he called on peace and human right activists to join the protest and show solidarity with the Arab community in order to preserve the cemetery.

The Jaffa project comes as part of a larger plan by the Netanyahu government to erase Israel’s Arabic history. It is an attempt to Judaize Jaffa and erase its Islamic heritage. It is an attempt to finish off Jaffa as a city and make it part of Tel Aviv. According to Arab Member of the Knesset Sami Abu Shehadeh, the issue of Al-Isaaf extends beyond the premises. Following the 1948 Nakba, Israel confiscated sacred Islamic places such as cemeteries and mosques, as well as commercial shops. Israel deals with the land and buildings it has confiscated as its own property. The issue is not whether it can afford to or has the space to relocate the project; rather it is that Israel does not want to create a precedent that would open the door for the Arab community to make more claims in historic Palestine.

Abu Shehadeh says Al-Isaaf is not the first cemetery that has been turned into a real estate project. Abdel Nabi cemetery was destroyed to make way for the Hilton Tel Aviv hotel and the authorities used the cemetery of Moanes to build an extension for Tel Aviv University. The problem is that Israel’s governments, especially since Netanyahu came to power, look at Arab citizens as enemies, viewing any claims to their heritage as an infringement on the Jewish identity of the land that, from their perspective, extends over the entirety of historic Palestine. Therefore, Palestinian citizens of Israel can never expect justice or equality in a system that does not accept them as Arabs or as Palestinians. They use the courts for technical issues, but the courts do not acknowledge their claims to the land as indigenous people — hence, they can never seriously use the system as a source of justice.

The Al-Isaaf issue is more than a reflection of the struggle between Muslims and Jews or Arabs and Israelis. It is a reflection of the struggle between people who believe in coexistence and people who want to eliminate the other. More than being a danger for the Palestinian community in Israel and its heritage, it is a danger to Israel’s leaders themselves, who one day will have to look in a mirror and ask themselves: Who are we? The other question is: Can we go on like this?

The world is witnessing a revolution that many have described as the end of the post-colonial era. People are demanding equality. The world will no longer accept Netanyahu’s apartheid style of government. Though the actions of the Israeli government are horrendous and do not signal any attempts at peace, the support offered by the Israeli Jews who refused such actions represent a ray of hope that change is possible inside Israel. The country’s policymakers should look at the changes in the world and see them from a pragmatic point of view. It is better for them to change now and relinquish their efforts to subjugate the Palestinian community inside Israel and in Palestine than be forced to do so by the international community sometime in the near future.
Dr. Dania Koleilat Khatib is a specialist in US-Arab relations with a focus on lobbying. She holds a PhD in politics from the University of Exeter and is an affiliated scholar with the Issam Fares Institute for Public Policy and International Affairs at the American University of Beirut.

 Israel Must Question Itself Over Bid To Erase Arab Identity – OpEd

Arab News

Arab News is Saudi Arabia's first English-language newspaper. It was founded in 1975 by Hisham and Mohammed Ali Hafiz. Today, it is one of 29 publications produced by Saudi Research & Publishing Company (SRPC), a subsidiary of Saudi Research & Marketing Group (SRMG).

UNITED FRONT
Israel TV: Hamas, Fatah cooperation against deal of the century a 'dangerous development'July 4, 2020

The national and Islamic forces and factions in Gaza, including Hamas and Fatah, reach an agreement on a unified national plan of action to confront the US' 'deal of the century' and Israel's annexation plans on June 28, 2020 [Mohammad Asad / Middle East Monitor]

July 4, 2020 

The ongoing cooperation between the two Palestinian rival groups, Hamas and Fatah, to topple the US deal of the century and Israel’s annexation is a “dangerous development”, Israeli Channel 12 reported on Friday.

Channel 12 disclosed that such a possibility was expected, but Israeli security did not expect that it would happen in such a short time-frame, adding: “It is a dangerous development because of the very short time they needed to reach this unity which surprised the Israeli security services.”

On Thursday, Deputy Hamas Chief Saleh Al-Arouri appeared with Senior Fatah Leader Jebril Al-Rajoub in a joint press conference, declaring their unity against the deal of the century and the Israeli annexation plan.

“The press conference is not important, but what is happening on the ground is very important, mainly the detention of Hamas members by the Palestinian Authority (PA),” Al Watan Voice reported the Israeli channel stating.

Read: Hamas, Fatah to unify efforts against annexation plan

Meanwhile, former Israeli Communication Minister Ayoob Kara stated that the Hamas and Fatah cooperation “raises concerns” as Fatah’s leader confirmed that his movement would let Hamas work in Gaza, Israeli Channel 7 reported.

Rajoub announced in the press conference that he was “confident about Hamas’ intentions,” noting that the Palestinians have been waiting for this conference to be the starting point of national unity.

The Black Lives Matter movement’s stand with Palestinians has a history

July 1, 2020 

A protestor holds up a "Palestine 4 Black Lives" placard at the Black Lives Matter protests in London, UK on 7 June 2020 [Lauren Lewis/Middle East Monitor]


Asa Winstanley@AsaWinstanley
July 1, 2020

It is common to think of Black Lives Matter as a single group when it isn’t; it is a movement. Indeed, it is a movement for Black liberation which first erupted in response to police brutality in 2014, following the killing of two African Americans: Mike Brown in Ferguson, Missouri, and Eric Garner in New York City.

The demonstrations which followed those two killings drew on the social media hashtag #BlackLivesMatter which had originated the year before, with the acquittal of George Zimmerman for the murder of Black teen Trayvon Martin in Florida.

In 2014 and 2015, Black Lives Matter became a national phenomenon in the US, with demonstrations all over the country. Solidarity protests then began to spread around the world. This global expansion has taken on a new dimension with the latest major wave of protests after the murder of George Floyd by Minneapolis police officers in May.

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Black people in the centres of former European colonial powers – London, Paris and Brussels – have taken to the streets. Along with their friends and supporters, they have protested against police violence, structural racism and the legacy of imperialism.

Although Black Lives Matter is a movement rather than a single organisation, there are also specific groups which call themselves “Black Lives Matter”, or some variation thereof. This can sometimes be a little confusing.

The group called Black Lives Matter UK was launched in 2016 and first came to national attention in September of that year with the disruption of London City Airport. They tweeted that the “climate crisis is a racist crisis.” Seven out of ten of the countries most affected by climate change are in sub-Saharan Africa, the protesters pointed out.

The movement has always had a strong internationalist dimension. This is not a break with history but is very much in the tradition of the Black liberation struggle, which saw Malcolm X stand against Zionism, and Black Panther Party leaders express their solidarity with Palestinian resistance fighters.

Last weekend, BLM UK continued in this tradition by posting a series of tweets condemning the Israeli annexation plan for the West Bank and demanding the right to criticise Zionism. “British politics is gagged of the right to critique Zionism, and Israel’s settler-colonial pursuits,” the group said.


As Israel moves forward with the annexation of the West Bank, and mainstream British politics is gagged of the right to critique Zionism, and Israel’s settler colonial pursuits, we loudly and clearly stand beside our Palestinian comrades.

FREE PALESTINE.
— #BlackLivesMatterUK (@ukblm) June 28, 2020


The pro-Israel lobby then proved BLM UK’s point, by trying to gag them. They were smeared as anti-Semitic for saying that criticism of Zionism gets you smeared.

The Board of Deputies of British Jews called the tweet an “anti-Semitic trope” and attacked BLM UK as “a supposedly anti-racist organisation”. Members of the Jewish Labour Movement’s leadership smeared them as a “fake” group which was engaging in a “hurtful fantasy”.

However, in stark contrast to the cowardly backsliding of left-wing Labour Party MPs and media outriders, BLM UK did not back down in the face of such dirty slanders. Instead, the group posted a powerful tweet which included a quote from Angela Davis.


One more time for those at the back.

From the British Black Panthers to Black Lives Matter, solidarity and learning from Palestinians in the fight against systemic racism has always been part of our shared struggle, and shared strength. pic.twitter.com/DlwBydqqNe
— #BlackLivesMatterUK (@ukblm) June 28, 2020


In 2016, the Movement for Black Lives in the US endorsed BDS, the movement for a boycott, divestment and sanctions against Israel. The group went even further, condemning US complicity “in the genocide taking place against the Palestinian people” and describing Israel as “an apartheid state”.

No wonder, then, that Israel and its lobby considers Black Lives Matter to be a major “strategic threat” to their apartheid regime which oppresses the Palestinians. By lashing out in such an underhanded and censorious fashion, though, Israel and the pro-Israel lobby are only making more enemies and creating more long term problems for themselves. They are sticking their fingers in the increasing number of holes in the dam. All obfuscation aside, at the end of the day, they are arguing against equality for all people in the land of Palestine, and yet still claim that Israel is a democracy.

As Ali Abunimah explained recently, “Zionism is the belief that Palestinians can and must be expelled from their homeland so that settlers can take their place. Zionism is the belief that Palestinian refugees cannot return to their homeland, to the towns and villages from which they were expelled, solely and exclusively because they’re not Jewish.”

That is why it is such an outrage when pro-Israel lobby groups like the Jewish Labour Movement want to crush all dissent when the topic under discussion is Zionism, and when despicable individuals like John Mann want any critical reference to Zionism to be “outlawed” in British political life. They do this because Zionism is indefensible on its own terms and cannot stand up under the close scrutiny of open and free debate. Its proponents are thus reverting increasingly to closing down such debate. Their efforts are underhand and distinctly undemocratic. Very much like Zionism, in fact.

Portrait of George Floyd, a 46-year-old unarmed black man who was killed after a police officer knelt on his neck for nearly nine minutes, is painted on Israel’s separation wall in the West Bank town of Bethlehem on 8 June, 2020 [Wisam Hashlamoun/Anadolu Agency]
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