How Voya Achieved 100% Growth After Spin-Off

Many executives say leading a spin-off can be like running a new company. While the operations end may seem as simple as breaking off a division, the C-suite must often create an entirely new brand and face mountains of legal work.

That’s how it felt for Rodney O. Martin, Jr. Now, nearly four years after leading a highly successful IPO of a spin-off, Voya’s CEO says the keys to success are acting with transparency and creating a strong culture.

Major insurance companies, including MetLife, AXA and Manulife, are preparing for or considering spin-offs of their life insurance segments due to the challenges of low interest rates. When ING Group decided to create the spin-off of Voya Financial in 2013, it appointed Rodney O. Martin, Jr. as chairman and CEO of the new company. Martin was challenged with leading an organization that was soon to be listed on the NYSE and would open its doors with 13 million customers.

He joined the company in April 2011 and prior to his appointment, served as the COO of AIG Worldwide and as the CEO of American Life Insurance Company while it was preparing to go public, though it was eventually sold to MetLife.

Martin and ING Group’s leadership team worked together to develop a playbook that included business strategy, capital allocation plans and a focus on financial and cultural improvement. One immediate challenge was that since the company was based in The Netherlands and followed IFRS accounting, it had to work to align with U.S.-based financials and convert to GAAP accounting. The firm had to submit nearly 200 product filings for review by individual states and had to make nearly 80 legal entity filings with state insurance regulators.

As they divested from their former parent company, Martin said transparency was paramount. Despite operating against a “very robust” timeline, he said there was an urgency to satisfy all internal and external stakeholders. The company had to navigate two languages and worked with numerous government stakeholders. “Throughout my career, full transparency has seemed easy and sensible, and it is consistent with my personal DNA to communicate with transparency,” he said.

Martin said the company also faced “ambiguity” in its mission during the financial crisis and that it needed to revisit its values and culture. He found that employees embraced a sense of urgency and welcomed the certainty of a new vision, focus and sense of direction. “We were able to rally the hearts and minds of our people around these elements, and ultimately the aspiration of being recognized as America’s retirement company. All of this adds up to what I like to call a 6,700-person startup,” Martin said.

Spinning off Voya also has positioned it to become a leading innovator in the insurance industry. Martin said Voya was designed from the ground up as a customer-centric organization with simplified IT systems, optimized use of data and analytics, a culture that fosters innovation across the company and the use of “bots” to improve relevant parts of the customer service experience.

Martin has looked to CEO peers both within and outside of the industry for advice and inspiration. He says because CEOs are often selected to fix something that is substantially broken, they must often deliver against the current circumstances of the company or the industry. He said outsiders often can offer a unique perspectives on how to work with regulators, navigate board structure, build a strong leadership team or pursue key initiatives that span across companies. Martin also looks to organizations such as the U.S. 30% Club to access experiences and insights on things like diversity and inclusion.

In the three years since the new company went public, it’s fair to say Martin’s strategy has been effective. Voya was one of the highest-performing IPOs of 2013, and the company has since established a strong track record of financial and operational improvement. The company has increased adjusted operating return on equity by more than 600 basis points since the end of 2012 and share price by more than 100% since IPO. “We achieved these results by making it clear that we would have a transparent and open culture focusing on growth, margin and capital initiatives, and rallying our people around our culture and goal to dramatically improve our performance,” Martin said.

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Craig Guillot

Craig Guillot is a business writer based in New Orleans, La. His work has appeared in Wall Street Journal, Entrepreneur, CNNMoney.com and CNBC.com. You can read more about his work at www.craigdguillot.com.