Policyowners' Examining Committee Overview

As your company, it is critical that we deliver strong performance and exceptional results while also transforming to meet the needs of clients, both today and into the future. Through our trusted advisors, personalized planning process and leading products, we help reduce financial anxiety for our clients, offering them more choices on how they can live their best lives. To deliver on this, we have to continually evolve the experience we provide while maintaining the financial strength and superior product value that have served us well for generations.

Since 1907, a group of policyowners has been given unrestricted access to the company to independently evaluate its operations, management and strategic plans. Each year, the committee's findings are published along with the company's annual report. The 2021 committee's complete report is provided here.

The 2021 Policyowners' Examining Committee members were grateful for the opportunity to serve Northwestern Mutual and its policyowners this year—a historic time for the company and society at large. As the company marks its second consecutive year of record sales and productivity, it is evident that Northwestern Mutual's brand of financial security, built on a foundation of industry-leading products, comprehensive planning and trusted financial advisors, is resonating in the marketplace. We observed a company that is highly aligned around a thoughtful multi-year strategy (that is producing extremely favorable results), deeply committed to its focus on financial strength to ensure success regardless of economic conditions and managed by a cohesive leadership team. Armed with its track record of acquiring clients early in life and proven “Protect and Prosper” approach of combining life insurance, investments and annuities within the context of a financial plan, Northwestern Mutual is uniquely positioned to help its clients achieve lasting financial security and navigate the process with confidence. The company is exceptionally strong today and, we believe, has put in place key elements to ensure success for many years to come.

While the “Protect and Prosper” thesis is sound, and leadership has made significant progress in bringing its vision of a modern, digitally enabled client experience to life, the way in which clients experience the company today can vary greatly based on the individual style, practices and capabilities of the company's 7,000+ independent financial representatives. The company's brand also remains largely associated with the sale of life insurance, which challenges the speed at which the company can grow integrated clients through deeper relationships, including wealth management. Leadership should consider expanding its marketing efforts designed to amplify awareness of the company's planning and investment capabilities and bolster its brand recognition as a provider of both insurance and wealth management solutions. This may require shifts to 1) amplify company messaging around its holistic approach and growing planning and wealth management capabilities, and 2) adopt a unified Field training and enablement strategy aimed at ensuring all clients have access to a consistent experience across advisors and practice types. With this in mind, the committee noted the following areas of focus:

  1.  Engaging customers around “Protect and Prosper” solutions

  2.  Investments in Advisor Training and Development

  3.  Environmental, Social, Governance (ESG)

Areas of focus

Engaging Customers Around “Protect and Prosper” Solutions

As the company continues to focus on deepening client relationships through financial planning, its marketing and branding strategies will play a pivotal role in supporting advisors' efforts to clearly articulate the value of combining insurance, investments and annuities in meeting a variety of financial needs. While the company has built a successful digital leads program connecting prospects visiting NM.com with advisors, expanding digital and social media marketing efforts with tailored messages based on customer life stage and level of engagement (prospect, client, active advisor relationship, planning client, integrated client, etc.) can help to better educate clients on the value of “Protect and Prosper” and drive deeper conversations between clients and their advisor. Investments in elevating company's brand awareness as it relates to investments and annuities may also be prudent to drive greater awareness of company's integrated offering. The size and capability of the company's advisor force is a tremendous asset and a strategic differentiator for Northwestern Mutual. Advisors have demonstrated exceptional agility during the pandemic in meeting clients' needs while onboarding a record number of new clients to the company—a significant boon to growing sales and market share. That said, today's younger mass affluent customers expect the freedom and ability to engage directly in planning and account management through digital applications and tools. The company has made significant progress in designing digital journeys to connect advisors with clients at key life events (purchase of a home, birth of a child, etc.) and drive proactive outreach between life events. The committee encourages leadership to consider ways to accelerate delivery of these experiences and features, including the ability for clients to engage directly in aspects of their plan on an ongoing basis, such as goal tracking and initiating automated payments. This may require additional investment in advancing horizontal data sharing across product and service lines and reducing legacy technology debt. There is a sense of urgency to advancing these capabilities as competition for NM's target customer is fierce, with many financial services companies investing heavily in technology aimed at attracting younger “DIY” clients through convenient digital access and flexibility to engage directly in “real-time” updates related to financial decisions.

Investments in Advisor Training and Development

As the advisor is responsible for the majority of client interactions and serves as the trusted “face” of the company, investments in advisor training and development will be critical to effective delivery of a client experience centered around “Protect and Prosper” solutions. The committee strongly endorses efforts to scale the company's National Training and Onboarding initiative to align advisor practices and capabilities with the company's updated go-to-market approach. With full adoption of the company's proprietary planning software, “PX,” expected in 2022, the time is ripe to more deeply train advisors on how to successfully bring together NM's proprietary tools, products, and planning philosophy to attract and engage deeply with clients. A digitally enabled advisor training platform, developed on a single chassis, will help to ensure greater consistency in how advisors interface with customers. Clear and consistent processes for training and onboarding new advisors should also lead to better outcomes in developing and retaining talent over time. As field leaders will continue to play a pivotal role in bringing the advisor training and development to life, continued investment in leadership development programs, apprenticeships and practice models aimed at growing the pipeline of quality, diverse field leaders should remain a top priority. As the company's distribution model has largely relied on “organic” growth, continued investment in attracting and developing field leadership will be critical to continuing the current growth trajectory and help position the company to reflect the diverse markets it serves well into the future.

Environmental, Social, Governance (ESG)

Lastly, the committee was pleased to learn of the thoughtful approach leadership has taken to develop a comprehensive Environmental, Social and Governance (ESG) strategy. While the company's values and practices as a mutual have long been synergistic with the spirit of sustainability, a comprehensive ESG strategy will help to drive more cohesion around the advancement of company's ESG objectives and grow awareness of the breadth of company investments in ESG. While the topic of ESG has gained velocity in recent years across stakeholders, an opportunity remains for companies like Northwestern Mutual to influence the development of common industry standards, calling for a more consistent approach across financial services firms to furthering ESG outcomes. The committee encourages leadership to continue maturing its ESG platform and ensure long-term resource commitments to meet the ambition of its strategy. Finally, the committee looks forward to hearing more about the company's ESG plans and commitments to date in its upcoming sustainability report launching in late 2021.

In closing

The committee commends leadership for its progress in transforming the company into a fully integrated financial services firm while delivering record results. While much has been invested in building the foundational products and capabilities needed to deliver “Protect and Prosper” solutions, a more consistent process for scaling the strategy, such that more customers are exposed to these capabilities, will be important to unlocking the full value of prior investments. If successful, the opportunity to drive greater client satisfaction and impact is great, particularly in today's uncertain environment. We are confident in leadership's ability to execute on its vision, given the company's exceptional strength, steadfast culture of seeing through on its promises, and willingness to invest for the long term. The current performance and standing of Northwestern Mutual remains exceptional—and the future is bright to continue building on this historic performance while transforming to leave an even greater legacy in the years to come.

Committee members

Sandra Rogers

Chair of the 2021 Policyowners' Examining Committee

Sandra Rogers

Vice President of Supply Chain at Hillrom

Anne Ackerley

Anne Ackerley

Managing Director at BlackRock and head of the Retirement Group (RG)

Michelle Nettles

Michelle Nettles

Chief People & Culture Officer at Manpower Group

Terry Thomas

Terry Thomas

Executive Vice President & Chief Customer Officer for Unilever U.S.

Mark Witt

Mark Witt

Shareholder in Godfrey & Kahn's Milwaukee office and a member of the Corporate Practice Group