Beyond Business
Blending Profit with Purpose
Beyond Business: Blending Profit with Purpose
From Apartheid Shadows To Global Spotlight: The Power of Persistence And Optimism
Read time: 2 min
EY Global spoke to Discovery Limited CEO Adrian Gore about the birth of Discovery Limited during the challenging post-apartheid era in South Africa.
Amidst the political and social upheaval, Discovery Limited built a transformative health insurance model to serve a nation plagued with a shortage of doctors, HIV/AIDS, and a heavy disease burden.
A big challenge was navigating the mindset against discrimination, particularly in the health sector. Excluding individuals based on pre-existing conditions could not be condoned, causing difficulty in creating a health insurance model.
“I was convinced that if you could build a proper health insurer, properly capitalized with the right principles, we could build a dramatic business that would make a real impact on society.”
Discovery Limited's solution was a radical shift in perspective: incentivizing health. Through the “Vitality Points” system, the company created a way to reward healthy behaviors and drive tangible, positive outcomes.
“We used to believe, from economics, [that] people make rational choices. In health care, they don’t. The price of going for the run is immediate — I’ve got to actually go for a run, and that's painful. And the benefits are 40 years away. So this concept of hyperbolic discounting; I'm not going to pay the price now. I'll take my chances. So the incentives break that cycle. You go for the run now; we give you benefits now.”
This instant gratification model fundamentally altered behaviors, decreasing mortality and illness levels. As their model brought tangible results, Discovery Limited drove international growth by forging strong partnerships and collaborations with global insurers based on shared visions for societal impact.
“Partnering is a skill in and of itself. It's about trust, about shared value, shared purpose… If the partnership is based on spreadsheets, projections, return on capital, I'm not convinced it can work.”
Discovery Limited employs a strategy balancing innovation and prudence in response to challenges. During the COVID-19 pandemic, those engaged in their health program had a “40% lower risk of dying from COVID-19.”
“So everything we do is about bringing down mortality, morbidity, health care costs, bringing down variability, reducing volatility.”
Discovery Limited views health as a pivotal component of the 'Social' pillar in ESG considerations and maintains deep societal commitment. This led them to diversify into Discovery Bank, extending their shared value model to the financial sector.
“Make people healthier, drive the issue of health as a critical component and pillar of the “S” in ESG.”
Gore emphasized that building a business requires human spirit, not just corporate strategy. He advocates the necessity of a good work-life balance and investing in the long-term.
“It takes up to a decade to get something of real scale, and you have to have absolutely the best people.”
One of the core values of both Discovery Limited and Gore is maintaining a sense of optimism as a leader.
“Pessimism sounds smart, but it isn't. Optimism sounds naive, but optimism requires engagement, accountability, investing.”
Discovery Limited's journey is a story of vision, innovation, resilience, and a relentless belief in the power of positive change for individuals and society. It is a testament to the power of optimism and visionary leadership in the face of adversity.
So What:
Can your team unlock constructive energy by taking a more optimistic approach with the business, team, and other key stakeholders?
Source:
Gore, A. (2023, Aug 07). CEO of Discovery Limited on balancing innovation with capital strength. [Youtube video]. Ernst & Young Global Limited. (Link)
