Business Environment Analysis of Beazley PLC - University Report

This report presents a comprehensive business environment analysis of Beazley PLC, a UK-based insurance company. It begins with an overview of the company, including its history, business activities, and hierarchical organizational structure. The report then details the company's corporate governance, identifying the board of directors, including executive and non-executive members, and their respective roles and expertise. The importance of the PESTEL framework is evaluated, with a detailed explanation of the political, economic, social, technological, legal, and environmental factors influencing business operations. The PESTEL framework is applied to Beazley PLC, analyzing the specific factors affecting the company's operations. The report provides insights into the macro-environmental factors influencing Beazley PLC's success, including political stability, economic conditions, social trends, technological advancements, and legal and environmental regulations. It highlights the importance of understanding these external factors for strategic decision-making and competitive advantage within the insurance industry.

Running head: BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
Name of the student
Name of the University
Author note

1BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
Executive Summary
The significant objective of the essay is to present an analysis of the business environment of
the insurance company Beazley plc based in the United Kingdom. The overview of the
company has been provided with respect to its history and description of business activities.
the organizational structure of the company has also been described thoroughly identifying
the hierarchical structure that increases the efficiency of its business operations. Furthermore,
the board of directors of the company has been identified along with a description of the
skills and expertise of executive and non-executive members of the board. The importance of
the PESTEL framework in analyzing the external environment of business organizations has
been assessed with a detailed description about the individual political, economic, social,
technological, legal and environmental factors that affect the operations of business
organizations. In addition to this, the framework has been applied to the company itself,
identifying the various factors that influence the business operations of the company along
with relevant examples.

2BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
Task - 1
Overview of Beazley PLC.
Beazley PLC is a holding company specializing in insurance businesses, based in the
United Kingdom and its headquarters in London. The variety of insurance services provided
by the company include insurance for property, professional indemnity, reinsurance, life and
accident, marine, contingency and political risks. The company was founded in the year 1986
and provides its insurance services across Europe, the United States of America, Middle East
and Asia. The company is registered in the London Stock Exchange. The company was
initially named Beazley, Furlonge & Hiscox when it commenced its operations in the year
1986. However, Hiscox was eventually bought out by Nicholas Furlonge and Andrew Hiscox
in the year 1992. Since then, the company has undertaken several strategies for the purpose of
propelling its steady growth (Beazley.com 2020).
The organizational structure of Beazley can be identified to be hierarchical in nature
due to the presence an extensive board of directors. The executive directors of the company
play the important role of ensuring the maintenance of a strong relation and direct link
between the non-executive members of the board and the business of the company
(Investor.relations.beazley.com 2020). Furthermore, the non-executive members of the board
have specializations in various fields thereby providing the company with in-depth expertise
in these aspects (Bloomberg.com 2020). A hierarchical organizational structure involves the
supervision of a leader or group of leaders such as a board of directors on the other members
of the company so as to provide guidance and ensure successful business operations (Islam,
Jasimuddin and Hasan 2015).

3BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
Corporate Governance
As mentioned earlier, Beazley plc has a hierarchical organizational structure
consisting of an extensive board of directors. The hierarchy among the board of directors is
ranked in a systematic manner so as to ensure optimum efficiency in the business operations.
The skills, knowledge and expertise of the individual members of the organization are
recognized as important factors in determining their designations and role in the business
operations. The board of directors can be segmented into two categories namely the group of
executive directors and the group of non-executive directors. The role of the executive
directors is to design, develop and implement strategies that may prove to be beneficial in
ensuring the growth and development of the business organization through efficiency of
operations (Fuzi, Halim and Julizaerma 2016). The non-executive directors perform the
responsibility of contributing to the efficiency and effectiveness of decision making and
strategy implementation procedures.
The three executive directors of Beazley plc are namely the Chief Executive Officer,
Chief Underwriting Officer and the Group Finance Director. The Chief Executive Officer of
the company is Andrew Horton. He had joined the company in the year 2003, for the role of
the finance director (Investor.relations.beazley.com 2020). Horton previously had an
experience of being the Chief Financial Officer at Lloyds Bank and Natwest. The Chief
Underwriting Officer of Beazley plc is Adrian Cox. He had joined the company in the year
2001 and performed the responsibilities of casualty treaty portfolio and large risk portfolio.
He was appointed the role of the Chief Underwriting Officer in the year 2019. The Group
Finance Director of the company is Sally Lake, who joined the organization in the year 2006
(Investor.relations.beazley.com 2020). Prior to her role as the Group Finance Director, Lake
performed the role of group actuary since 2014.

4BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
The non-executive directors of the company include the Chairman and other directors.
the Chairman of Beazley plc is David Roberts (Investor.relations.beazley.com 2020). The
other no-executive directors in the board include Sir Andrew Likierman in the remuneration
and nomination committees; John Reizenstein, Nicola Hodson and Robert Stuchbery in the
risk and audit committee; Catherine Woods and Christine LaSala in the audit and risk,
remuneration and nomination committees; and John Sauerland in the remuneration committee
(Investor.relations.beazley.com 2020).
The board of directors play the important function of strategizing efficient means so
as to integrate the interests of the stakeholders with that of the organizational goals and
targets. From the perspective of the shareholders, it is the responsibility of the board of
directors to maintain transparency regarding whether the company is earning profits or
incurring losses. The efficient strategizing of business activities by the board of directors
would serve the interests of the shareholders, as the successful operations of the organization
would enable them to maximize their profitability. From the perspective of the employees,
the board of directors play the role of managing their business operations and functions,
along with supervising and guiding them on the basis of their knowledge and expertise.
Implementation of new strategies or changes are also integrated among the employees by the
board of directors. from the perspective of the customers, the board of directors are required
to strategize cost and resource efficient means of providing services so that the demands of
the customers are effectively met.
Task - 2
PESTEL analysis
PESTEL analysis provides a strategic framework for the evaluation of the macro-
environmental factors that influence the operations and functions in business organizations.

5BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
Such an evaluation of the external environment aids the organization to design, develop and
implement effective strategies that facilitate its ability to utilize the opportunities and prevent
the challenges arising from the threats that may be faced by them during the course of their
business operations (Perera 2017). The macro-environmental factors that are evaluated using
the PESTEL framework involves the political, economic, social, technological,
environmental and legal aspects (Shtal et al. 2018). The identification of the potential of the
external environment in which a business organization operates is essential for the purpose of
differentiating from the competition and creating a competitive advantage in the market.
According to the PESTEL framework, there are several political factors that may
influence the operations of a business organization. These political factors may include the
governmental policies, political stability of the country in which the organization operates,
taxation policies, trade policies, environmental laws, labor laws and the like. The economic
factors operating in the external environment of a business organization plays an important
role in determining the degree to which the company may conduct profitable business
operations (Shatskaya, Samarina and Nekhorosheva 2016). The economic factors that can
influence such operations include the rate of economic growth in the country in which the
company operates, the gross domestic product, rates of interests, inflation, exchange rates,
disposable income of the customers and the like. Social factors play a crucial role in
determining the attitudes and shared values of the consumers, and thereby their tastes and
preferences of products and services. Technological factors help in determining the efficiency
of the business activities undertaken by the organization in terms of utilization of resources.
These factors include technological infrastructure available in the countries in which the
organization operates, new ways of producing and distributing products and services along
with the means of communication available for marketing these goods and services to the
consumers (Sammut‐Bonnici and Galea 2015). Environmental factors affecting business

6BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
operations of organizations include regulations of the government pertaining to the utilization
of raw materials, targets of carbon footprint and pollution. The legal factors affecting the
operations of business organizations include health and safety regulations, consumer rights
and laws, regulations regarding product labelling, wage regulations of the employees and
standards for product safety.
Conduction of a PESTEL analysis for the evaluation of the external environment in
which the organizations operate is essential for the business organizations due to several
reasons. The primary advantage of a PESTEL analysis to business organizations is the
provision of an understanding regarding the opportunities and threats that may be faced by
them during the conduction of their business operations and functions. Such an
understanding, in turn, helps the organization to formulate and implement effective strategies
to achieve cost efficient means of production of goods and services through the efficient
utilization of resources available to them (Litavniece and Znotiņa 2015). Strategies pertaining
to marketing and building of customer relationships is also facilitated through the analysis of
the PESTEL framework for the external environment of the business organizations. The
growing competition in the global business environments requires the organizations to
engage in effective and efficient decision making processes in order to exploit the
opportunities available to them and gain a competitive advantage in the market. The PESTEL
analysis helps the organization in the careful evaluation of such opportunities thereby aiding
them in the decision making and strategy implementation processes.
Task 3
PESTEL Analysis of Beazley plc.

7BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
A PESTEL analysis of Beazley plc. will aid in the provision of an evaluation of the
macro-environmental factors that will affect the business operations of the company. The
PESTEL analysis is provided as follows:
 Political factors – Beazley plc is an insurance company which has its operations in
several countries, thereby exposing itself to various kinds of political environments
across the world. In this regard, the company may be faced with different
opportunities or threats depending on the political situations and regulations in each
country. The political factors affecting the operations of the company include the
political stability and business environment of the insurance sector in each country
(Soopramanien 2016). The level of corruption present in each country also plays an
important role in determining the attitude and behavior of the local employees and
consumers of the country as well as cooperation of the governments in the business
activities of the company (Penning-Rowsell, Priest and Johnson 2014). In this regard,
the government may or may not choose to intervene in the operations of the insurance
industry. In addition to this, different regulations such as trade policies, tariffs and
taxation rates significantly determine the business operations of the insurance
company (Gaganis, Hasan and Pasiouras 2016). Safety regulations pertaining to the
insurance industry established by the different countries in which the company
operates also need to be adhered to by the company during the conduction of their
business activities and functions.
 Economic factors – The economic system and potential of economic growth in the
countries in which the company operates act as important determining factors for the
operations of Beazley plc. The exchange rates of the countries and level of efficiency
in financial markets also determine if the company would require to raise capital in
the local market for their successful operations (Wosskow 2014). From the

8BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
perspective of employment of local individuals within the scope of the organization,
the level of education and availability of skilled labor in the insurance industry will
depict the success of the company in the country. Among other economic factors that
affect the operations of company include inflation rates, rate of unemployment and
the rate of economic growth in the countries in which the company operates.
 Social factors – The social factors that influence the business activities of Beazley
plc. include the level of education among the prospective customers. From a
behavioral and psychographic perspective, the awareness of the consumers regarding
the purpose and scope of insurance determines the demand that the company may
have in each country where they operate. Furthermore, the level of employment of the
customers also would directly determine their purchasing power therefore attitude
towards investing in insurances. The presence or absence of risk taking attitude
among the people directly influences their preference of investing in insurances
(Bryce et al. 2016). Furthermore, the company is also required to adhere to the health
and safety standards established in each country where they operate in order to be able
to positively influence the perception of the consumers towards the company, and
help in building their trust and loyalty.
 Technological factors – The efficient use of technology available to a business
organization plays an important role in determining efficiency of operations. The
technological factors affecting the operations of the company include the
technological advancements undertaken by the competitors of the company.
Investments made in the field of research and development of cost efficient
technology for the efficient utilization of resources is an essential consideration for
Beazley plc. Technological trends in the insurance industry such as the use of
artificial intelligence, predictive analysis for pricing and risk selection and machine

9BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
learning to provide speed and accuracy of processing are important factors to be
adopted by the company. Furthermore, the accessibility of the consumers to social
media platforms and network connectivity also determines the efficiency of the
marketing strategies adopted by the company.
 Environmental factors – Environmental factors affecting the operations of Beazley
plc include the laws and regulations adopted by the different countries in which the
company operates pertaining to environmental pollution (Authority 2015). The
attitude and awareness of the people about environmental concerns and the adherence
of the company to the environmental laws of the country will ultimately help in
determining the perception of the consumers towards the brand. Sustainability in
business activities with respect to the targets of carbon footprint and insurance
policies on green projects would also contribute to the efficiency of the business
operations of the company.
 Legal factors – The legal framework of the countries in which the company operates
also has an impact on the efficiency of the business operations. In this regard, the
identifiable legal factors influencing the operations of Beazley plc include copyright
or intellectual property laws, consumer and data protection laws and anti-trust laws in
the insurance industry (Romanosky et al. 2017). Insurance regulatory laws adopted by
the countries in which the company operates lays out specific guidelines for the
business operations of the company. Furthermore, bodies like the Prudential
Regulatory Authority and Financial Conduct Authority also determine the activities
and operations of Beazley plc. in the United Kingdom.
The above mentioned factors in the PESTEL framework provides a detailed analysis
of the macro-environmental factors that influence the business activities and operations of
Beazley plc. In this regard, it can be noted that a thorough evaluation of the external

10BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
environment of the company would provide a clear understanding about the opportunities and
threats that may be faced by the company and thereby, aid it to strategize effective means to
obtain a competitive advantage in the market.

11BUSINESS ENVIRONMENT ANALYSIS OF BEAZLEY PLC.
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