AXA’s management practices

This section provides an analysis of AXA’s management practices and their relevance to the insurance industry. According to Hotimah (2020), AXA has maintained its global presence and growth through its formal corporate social responsibility strategy and as a core approach in every business management decision-making practice created in 2008.

Since this, time the company has made several changes in the corporate social responsibility practices to accommodate changes and new trends witnessed in the insurance industry. For instance, the policy’s success reflects through the organization’s inclusion of corporate responsibility in different departments to ensure accountability and transparency in measuring its impacts and success in the industry. For example, since 2008, the company’s corporate social responsibility department operated under the communications department until 2014, when AXA expanded its corporate strategy to be governed and managed under the plan and public affairs department (AXA Group, 2020). The company’s reorganization emphasized the importance of management to include corporate strategy to consider the impacts of a particular decision on the public by integrating corporate responsibility in every business segment. The main question that the management asks whenever it comes to decision making is how the change affects its financial performance, customers, and society, thus determining its sustainability in the future.

Reorganizing the corporate social responsibility within the company aimed at enhancing its monitoring process and measuring the effectiveness of its corporate responsibility efforts. Additionally, the management creates accountability to the responsible team for developing metrics to assess corporate social responsibility practices.

According to Majewska (2020), the metrics introduced by the newly created strategy and public affairs department included the Dow Jones Sustainability Index Methodology created for investors to assess corporate social responsibility scores. However, the company’s management aimed at introducing corporate responsibility metrics that could help the management identify corporate responsibility issues at the global level and how addressing these issues could add the company’s value in the market. This approach would bring the corporate responsibility practices closer to its strategy and enhance its brand image to customers.

AXA implements its corporate strategy by focusing on three core areas that determine its corporate responsibility practices. The first aspect of consideration is the company’s investment in reducing its impacts on the environment by focusing on efficient use of resources and reducing carbon emissions from its activities.

According to Scheffler & Wirths (2019), AXA partnered with TC to assist in using technology to reduce the emission of carbon into the atmosphere and create carbon sinks to trap and store carbon from the atmosphere. This strategy reflects the company’s commitment to reducing its environmental impacts and contribution to climate change. The effects of this process reflect through the measurement of the tons that the company obtains from its operations. The corporate responsibility team also enhances corporate social responsibility practice by measuring its water resource usage in various functions. For instance, AXA recognizes the importance of assessing clean water and ensuring a safe and healthy future by using innovative solutions to enhance accessibility to clean water. As Scheffler & Wirths (2019) stated, AXA partnered with WaterAid Company and supplied more than 10,000 people clean drinking water in India. This trend shows that environmental protection and efficient use of resources is at the core of AXA’s management practice. In assessing its ecological impacts, AXA calculates its annual carbon footprint using data collected for the entire year and reports the following year. The company has well designed internal protocol they follow when collecting and reviewing the data to ensure that any business changes are observed and reported over that period.

AXA management also includes social elements when deciding the impact of a particular decision as part of its core corporate responsibility. The effects of this strategy reflect through the company’s involvement in various social issues in different market segments. For example, AXA implemented a company strategy that focused on supporting people communities to recover from multiple domestic violence issues since 2017.

The company has included this as part of its business strategy by employing more than 34 employees to support the program in New York and London. They devote more than 718 hours of their operations, with each hour valued at $500 (AXA Group Report, 2020). Moreover, AXA engages in supporting social issues that may affect people in the society where they operate. The company’s engagement in solving social problems seeks to build a strong bond between the community and the company, thus enhancing its image. For instance, AXA partnered with US-based nonprofit rapid Results Institutes to support an innovative approach capable of ending youth homelessness in the country in 2019 (AXA Group, 2020).

Since then, several projects have been established and addressed most of the challenges facing youths related to housing challenges. However, AXA supports social programs depending on the activities that appear to be more important in each target market. AXA also targets customers across different income levels. Under AXA’s insurance services, the management decided to create insurance services that target customers at the high, middle, and low-income earners as part of extending its social consideration to customers.

The AXA’s Group maintains a strong presence in the market by creating strong and separate governance to ensure an effective strategy for ensuring transparency and effectiveness in different corporate social responsibility aspects. In the governance aspect, the company promotes a respective chairperson and independent board that identifies, evaluates, and implements a particular corporate social responsibility activity. The evaluation process considers the costs incurred in enforcing the action and its value to the company. The independent board ensures transparency in disclosure of the activities, thus supporting the AXA to achieve its short and long-term goals. The management includes people from different areas of expertise. For instance, AXA’s corporate strategy team consists of a network of local chief corporate responsibility officers with a CEO to coordinate and control the corporate responsibility strategy at the local level and align it with the company’s long-term goal (Hotimah, 2020). The global team occasionally meets during seminars to discuss and identify the matters that influence the community and how AXA can intervene to build its relevance in society. The Corporate responsibility team also made the strategy the heart of every department by creating an integrated corporate responsibility management team across different departments such as finance, procurement, marketing, brand, distribution, and risk management as key components for discussing and identifying the corporate social responsibility practices within the company. Therefore, successful leadership has been at the core of the business, thus ensuring a development of an effective and successful corporate strategy that adds value to the organization’s activities.

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