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Prudential’s new chief executive has said Africa presents the same long-term growth prospects as its markets in Asia, signalling that expansion in the continent would be the next roll of the dice for the FTSE 100 insurer after a drawn-out exit from its US and European operations.
Speaking to the Financial Times, Anil Wadhwani, who announced last week that he would “do things differently” at the insurance group, said the drivers of growth in Africa were “very similar” to those it has experienced in its core Asian markets, with fast-growing populations and rising appetite for insurance products.
“We believe that over a period of time, Africa will provide us with that growth opportunity, as the markets mature, as the customers get a lot more aware of wanting and needing insurance as part of their protection, health coverage, as well as savings needs”, he said.
Over the next five to 10 years, Wadhwani added, Africa could be “absolutely a growth engine that could complement” the growth in its Asian business. He pointed to Vietnam, which has grown from a small operation to one that provided $298mn of sales last year, or 7 per cent of the group total. “If I could find the next Vietnam in Africa, that would be awesome.”
Wadhwani began his role in February, but has only started publicly outlining his plans for Prudential in the past week, after the company published half-year results.
Prudential has been through a major transformation in recent years, shedding its businesses in the UK and the US following pressure from shareholders to focus on faster-growing markets in Asia. It completed the restructuring in 2021.
That left it with a large exposure to Hong Kong and China at a time when Covid-19 restrictions cut off an important revenue stream, in stopping mainland Chinese customers from crossing the border to buy insurance policies in Hong Kong. Prudential’s steep fall in new business profits in the territory last year highlighted the risks of its new, smaller footprint.
Prudential currently operates in eight African countries, all of which grew their sales by a double-digit percentage in the first half of this year. But the entire continent provided just 3 per cent of 2022 sales. Wadhwani highlighted Kenya, Ghana, Nigeria, Uganda and Zambia as examples of countries that could provide outsized growth.
The start of Wadhwani’s tenure as CEO was marred just a few months in by the resignation of the group’s chief financial officer James Turner in the wake of a conduct investigation. The company issued a strongly worded statement at the time, saying Turner’s conduct “fell short” in relation to “a recent recruitment situation” and that he would miss out on some bonus payments. The former CFO declined to comment.
Fostering a positive workplace culture at Prudential would be crucial, Wadhwani said in the interview. “I’ve always believed culture is absolutely fundamental. It is a key differentiator,” he said, adding that Prudential was announcing a new set of corporate values in the coming weeks that had been co-created with employees.
He encouraged staff to “voice an issue if they see it” through whistleblowing channels. “The greater transparency and the greater openness our employees experience, I think that’s going to be very important for us to drive the culture that’s going to help us execute or accelerate our strategy.”
Despite a retrenchment from western markets that has seen the group left solely as an Asian and African insurer with a management team split between Hong Kong and Singapore, Prudential has retained a UK domicile, a joint listing in London and Hong Kong and a joint headquarters in the two cities — even while jobs at its base in London have been scaled back.
“We have talent in London which we’d like to preserve,” Wadhwani said. “London, pretty much, we will maintain, and have talent that will help us stand out, attract and manage the different stakeholders.”
Wadhwani added any questions over the status of its London headquarters, or its UK domicile, were “not my priority right now”.
