Former RSA Ireland head denies culture of fear

Former RSA Insurance Ireland chief executive Philip Smith has denied claims made at the Employment Appeals Tribunal that a culture of fear existed at the insurer that stopped colleagues from blowing the whistle on accounting problems.

Mr Smith, who resigned as the head of the British insurance company’s Irish division in November 2013, told a hearing on Wednesday that claims by former colleagues that he was someone to be scared of did not tally with his own recollection of his relationship with staff.

In testimony read out by RSA counsel Brian O’Moore, the tribunal heard former senior colleagues describing Mr Smith as someone who was both charismatic but also difficult to work for.

“He was a great leader but you didn’t mess with Philip,” was how one colleague put it. Others described public “floggings” and a tension whenever the former RSA Ireland chief executive was in a bad mood.

Mr Smith denied these reports, which he described as “an attempt at a complete destruction of my reputation”.

“I was a very positive, people person,” he said, recounting a happy workplace in which few employees chose to leave until his resignation. “The company exited people after I left. They all stayed under my tenure.”

He said the perception was that he was a strong leader who managed the business well and that this was borne out by his exemplary record prior to his leaving the company. Such was his standing, that he claimed he was approached by rivals to join their companies in a lead role on average 6 to 8 times in a year.

Mr Smith was speaking during the third day of cross-examination in a constructive dismissal case against RSA. He joined the insurer in 2006 and served as its chief executive from 2007 to November 2013. Under his leadership, RSA went from being the fifth-biggest insurer in Ireland to the leading one.

He was suspended by the company on November 8th, 2013 pending the outcome of an investigation into issues in the Irish claims and finance functions that were identified during an internal audit. Later that same month, the company revealed that Mr Smith had resigned with no severance package being offered.

Mr Smith, who has previously claimed he’s been made the “fall guy” for problems at RSA Ireland, said suggestions that former colleagues, including ex- chief financial officer Rory O’Connor, were too afraid to reveal all about financial irregularities at the insurer, were simply untrue and made under duress.

“In a climate of fear and anxiety, people were naturally running for cover and the blame game kicks in,” he said, referring to the series of interviews held with former colleagues during the investigation into accounting problems.

He said the claim that Mr O’Connor had considered whistleblowing but had decided against because he was scared of Mr Smith were the result of self-preservation, adding that his former colleagues had plenty of opportunities over the years to go to his superiors without his knowledge if they had any problem with his conduct.

Mr Smith said it was hard to know exactly when it had been decided that he and his colleagues would be “pushed in front of the bus” but that having found himself being backed by senior management at RSA, the mood changed quickly as the investigation into accounting problems got underway in October and November 2013.

However, he reiterated claims made on Tuesday that a draft report into the controversy over insurance reserves by Vanessa Evans, RSA's group head of human resources and Derek Walsh, the insurer's group general counsel, was a "character assassination."