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Good morning. Thank you for joining us in this very nice setting in Paris. It happens to be the former offices of our regulator, so for us it's, it has a lot of meaning. We're joined online by, I think, many participants. I don't have the number. But for those of you who are online, welcome to this Capital Markets Day. We're hoping today to share our vision for the next four years at Coface, building on the history that we've written over the last eight years. Before I start, let me just highlight some of our team members here that have joined today. We have almost the entire executive committee of Coface present, except the leader of Asia and the leader of Latin America who had a pretty long journey to make, and then our Central Europe leader.
But everybody else is here, so if you have questions, if you want to talk, if you want to get insights on, on this or that aspect of the business, everybody's at your disposal, and we'll be very happy to explain their part of the business. With that, I think I need to, first of all, talk about the agenda for the day. So we're going to talk about this plan, Power the Core. I'm going to be the first one speaking. Then we will have a section around growing TCI, trade credit insurance, starting with underwriting, and then talking about growth. We'll have a break, and then we will talk about what we call the core, data, scoring capabilities, growing Business Information Services, investing in technology, and connectivity. And after that, Carole will take us through a section on culture and CSR.
Before we talk about financials, obviously, as is the tradition in these settings, and our financial ambitions for the next few years. Then we'll have a Q&A session, and that will be our day. So I hope you enjoy this session. So Power the Core. Power of the Core. I mean, this title, I think, embodies our vision for what we're going to try to achieve during this plan, which is to build the global credit management or credit risk management ecosystem of reference. That's what we define as the core. We want to have an even better core than we've built over the last eight years, and we want to make that core available to more and more use cases and broaden its utility for the benefits of our clients, corporate clients.
So we're going to deepen, and we're going to broaden from the foundation that we've created. I really want to, during this presentation, leave you with three big ideas. Number one, we're going to be spending some time on explaining the industry in which we operate, because I think we're clearly a smaller part of the insurance or the segments, and not many people understand really what we do. But the key message here is trade credit insurance is a good industry to invest in. It's profitable. It's highly concentrated. There are high entry barriers, and we happen to be the owners of one of the best franchises in this industry. Number two, we are a good business in this industry. We've built over the last eight years, I think, very strong foundations.
We've invested both in our technical capabilities and our expertise and our distribution capabilities. And we've launched a very unique new venture, Business Information Services, that has strong synergies with the core. And we have very strong ambitions going forward to continue to invest in the core of that business. And then finally, we're raising our financial targets for the future. You already know the numbers. They've been published yesterday. And I think it makes for an interesting and attractive proposition for investors. So, we've had that feedback several times that we should spend a little bit of time explaining the industry in which we play. And I have a few slides here. This describes our industry. As you can see, it grows annually pretty much in line with GDP, actually, with nominal GDP.
But it is a very highly concentrated market. The top three global players, we are actually the smaller of the top three, have about 60% of the global market. And if you add a, you know, the Chinese, our Chinese counterpart, which is kind of a monopoly in its own way, we're at 75%. The rest is scattered between local export credit agencies or private players. But basically, very few companies have the ability to play on a global scale in this market. As I said, we tend to be a good business to own in when there's inflation around, because we tend to grow with the GDP, with the growth of our clients. We tend to bill our clients a percentage of their own turnover, which makes us naturally geared towards growing faster when the inflation is higher.
We do expect, obviously, the inflation to subside in a short term. It's a market with strong barriers to entry. I mean, I'll just describe some of the things here that we have, which are not easy to build. I mean, proprietary scores and data. We have a database of 195 million companies. You'll hear more about this today. We have scores, and we have developed knowledge about credit risk in hundreds of countries, and that is very hard to build. We operate ourselves with employees in 58 different countries. We have 160 different partners around the world. So this whole infrastructure plays together, one single role in helping our clients trade around the world. It requires technology. We have to be able to do this in a consistent way around the world.
We have to have experience. I mean, this company was created 75 years ago in France. It bought an even older German company that has just celebrated its 100 years, which means we've gone through all the crises that the last century has pretty much been able to show, and we've survived, and we've performed through all of these different crises. We also deal with 56 different regulators around the world, and we are just in the United States facing 50 different states, each one of them with their own regulations. So I think you see it. And when you add all of these features, it's not easy to compete in this space, and it requires a lot of time and a lot of, I would also add capital, because we do have EUR 2 billion of capital, regulatory capital, to support our operations.
The second notion I want to insist on is we are not just an underwriting business where we decide to take risk or not take risk. We are much more of a high-intensity service business. This chart describes the life, if you will, of a contract, from the sale to setting up the policies around multiple countries to the day-to-day interactions that we have with our clients, and then when things don't go so well, how we pay claims and basically recover the money at a later stage. And throughout all of these phases of the life cycle, we have intense relationships with our clients. I'll just take one example, which is requesting limits.
So at any point in time during the life of the contract, a client can call us and say, "I would like to trade with this or this party, and I would like to know what credit limit I can safely have for this name." And we think we've calculated that on average, we have one contact per week with each one of our clients, just for that purpose. So it's a high-intensity business, which means there's going to be a lot of trust and a lot of people connections and a lot of technology connections between us and our clients, much more akin to a service business than just a pure insurance guarantee business. When we think about growth in this business, we look at four things, right? How do we acquire new clients? How do we not lose existing clients, cancellations?
How does our pricing evolve? And then what drives the activity on which that pricing is based? And, and I'm going to take you through each one of these points and, and try to give you some highlights of how we see our business. First, about new business. We, we cater to the needs of we, we define our, our market as in four different key segments, right? Number one, our international groups. About half of them have recourse to, to credit insurance. The other half is not insured. They represent about a third of our business. And typically, what they look for is global coverage. They look for whole turnover cancelable policies, which is typically our core offering, but also for specialty coverage, excess of loss, non-cancelable lines. I mean, so they are the most demanding. They are the most pressing of our clients.
They are the ones that justify this whole infrastructure that I just mentioned before. And this is because of them that we operate in all four corners of the world, and because of their business, we are actually able to support those infrastructures. The second segment would be the mid-market, and that's a market which is quite penetrated in Europe, about 40%, much less in the rest of the world, and which is the core, I would say, segment for our whole turnover, cancelable policies that we typically offer. A huge white space is the SME space. Less than 1%, we think, globally have access to or have chosen to cover their risk with trade credit insurance. They want something easy, simple.
It requires huge distribution networks, and that's really a white space because we haven't really been, as an industry, able to crack that space in a very meaningful way. Finally, financial institutions use our services for financial arbitrage, for regulatory arbitrage, for support in the ability to take more risk, and that's another fast-growing and very interesting segment. So that's the markets that we target. The question is then, how do we retain clients? And you see here on the left-hand side of this chart how our retention rate, so the percentage of clients that stay with us every year, has increased from below 90% to 93.1%. So this matters a lot because it's a lot cheaper to retain a client than it is to acquire a new one, and a lot less risky, by the way.
We've developed some really cool technology to try to predict who's going to leave us and why they would leave us. And then we have a whole process to try to minimize that attrition. I think we've been very effective in doing so. But what it means, I think more importantly, is that we're going to be living with clients for tens of years. On average, probably 15 years. For large groups, it's actually spans decades. What that means is that we're going to go through the ups and downs of the economies with our clients. It means that the price is not going to be a question that we deal with on an instantaneous basis, but more of a long-term relationship basis, you know? If the price is too high, clearly the client's not going to be happy.
If the price is too low, we're not going to be happy. But we're entering a very long-term partnership with our clients, one that is based on trust, one that is based on service, and that reinforces this notion that I think we are much more a service business than anybody really even understands. Talking about price, I mean, typically this industry gets better every year because technology allows more efficiency, because we understand data better. We're getting better and better at predicting what's happening. And as we do this, typically, those gains tend to get passed on to our clients. So on average, I would say over the last decade, prices have gone down 1%-1.5% every year, benefiting our clients. It's a product that is not expensive for a company, and that's why I think it is appealing.
Our ability to manage risk and to prevent risk from happening is really what clients are looking for in a relationship with us. And then, you know, client activity. So we typically bill our clients a percentage of their own turnover. And so if our clients grow, typically our turnover will mechanically increase. And you see this here on this chart. We've had a little bit of a dip in 2020 with COVID, and then we rebounded very nicely, probably some of the best years we've ever had in 2021 and 2022 as inflation picked up. So this is a very good business to be in inflation times. When there's inflation, as you know, central banks tend to raise their rates. When they do this, our portfolio of investment actually tends to perform better. It also tends to increase insolvencies.
But when that happens, then central banks start lowering their rates, and that decreases insolvencies. So that's really how the game is played, and that's how things work. So we've been eight years. I've been personally eight years, and quite a few members here of the team have been with me or even much longer with this business. I think we've built a very profitable and high-quality franchise. I mean, some of the numbers here you see on this page, we're 40% bigger than we were eight years ago. Client retention has gone up by almost five points. Solvency has increased by almost 50 points. We have managed to grow our shareholders' equity even though, as you know, we distribute between 80% and 100% of our earnings every year.
The cost ratio, that's something we're very focused on, has gone down by 8 points, and that goes directly to the bottom line of, of the business, over the course of the 8 years. The loss ratio has performed very well, and our profitability in terms of return on average tangible equity has, I would say, pretty much doubled over the course of the last 8 years. So we start, I think, from a very high-quality franchise. I think these numbers compare very nicely to, to the rest of the industry. You see the graphs here. I mean, the cost work has been happening every year, so we are relentless about this. The losses have been with ups and downs but have been pretty much contained, bringing the combined ratio to pretty low levels. And we've been able to do this while growing.
So it's not, it is not preventing us from growing at least the rate of the market. During that time, and particularly in the last plan, the last four years, Build to Lead. We had the ambition of building the foundations for a strong business, and that's really what we've done. So we have been spending time investing in our risk infrastructure. I think today we can say we have probably the best risk infrastructure in this industry. We've invested in our sales organizations around the world. We've built the foundations, whether it is in terms of people, in terms of processes, in terms of systems, to have very effective sales forces, and you'll hear more about this during the day. We have simplified our operating model. This is not over. This is something that's been started.
It's a multi-year effort to try to simplify the business so that we could simplify our technology so that we can improve our service and our performance. We've established the foundations for something new, business information services. You'll hear a lot about this today. We've pretty much tripled the size of that team in the last three years, and we are investing both in technology, in our product structure, in our data capabilities. Again, lots of discussions to come around this today. We've set some very clear, simple goals for CSR, and we are committed to delivering them. You'll hear more about this.
And finally, I think for to me, one of the most important things, we've created a unique culture centered around four key values: client-first. We, we are nothing without our clients. Expertise, this is the core, expertise. Collaboration, because as you can now tell from, you know, working in 100 different countries across, across the world, collaboration is absolutely essential. And then courage, courage, discipline, and courage. We'll hear a lot about this with Cyrille when we talk about underwriting here. So I just want to say a few more words about business information because you'll, you'll hear a lot about this. It's, it's, it is actually very linked to the core of Coface.
As we have developed this trade credit insurance franchise over the last years, I think we have developed very unique assets, whether it is a database, whether it is global coverage in terms of data, a network of partners and information providers that we are digitally connected to, some unique scores and methodologies. We'll hear a lot more about this today. Underwriting capabilities and expertise spread out in tens of markets and a strong brand and strong reputation in this space. We have been able, using this, to develop unique products and services which are positioned, I would say, in a very singular way in this market: credit opinions, DRAs, risk assessments, reports, or country or sector risk expertise.
All of this gives us the opportunity to develop a very unique value proposition, one where if you work with Coface, you have one-stop global access with scale to any data point anywhere in the world. So we've done the work of putting all this stuff together for you. You have the insights of a leader of the trade credit insurance space. I mean, we have EUR 700 billion of risk on 3 million different companies that we monitor every day for ourselves using this infrastructure.
And that's something that's, that's something very unique compared to those who might be able to offer data but, you know, have, just offer data. They don't really have anything hanging on it. And then we have developed some very simple tools, technology, that allows you to access this data. So it's out of this realization that we decided to launch this, business information initiative.
There's been a lot of discussion. Is information going to compete with trade credit insurance? And the argument is no. And actually, at this stage, we're absolutely convinced it is not just not competing, but it is also completely synergistic. On the right-hand side of this chart, you can see how we source data and information from private sources or public sources and a variety of different means to create a data patrimony which serves as the basis for our underwriting and trade credit insurance. And then the return of experience from that trade credit insurance activity gets fed back into this data lake and provides us with unique patrimony to work for in terms of business information on the right-hand side. And these two businesses work very closely together. If we develop both, we buy more data.
We have more scale. If we buy more data, it's going to be cheaper. If we buy more data, we will buy one time to sell several times the same piece of data so we get better margins. We can invest more in data science, in technology, in expertise, and therefore we derive better insights both for business information but also for the trade credit insurance business. We see that actually where we have a strong historic presence in the more mature markets that are more difficult to penetrate, it actually helps our business information venture because our name is strong and therefore people will naturally be drawn to this company in terms of its reputation for providing good information. So there's a lot of ways in which having both makes us stronger in both: cheaper, more efficient, and a lot more expertise.
So, Power the Core. It follows two other plans. Fit to Win was really about getting back on our feet and proving that we could compete effectively in the market. And we just got the basics right, I would say. Build to Lead was about proving that we could be the best credit, trade credit insurance franchise in the marketplace and derive year after year, you know, strong results in the face of all the uncertainties that we face in the market. And I think we've proven this. And now we are on to the next one, which is Powering the Core, which is really about building this unique, I would say, of reference global credit risk management ecosystem. And you'll hear a lot more about what that means over the course of the next couple hours. So Power the Core, there it is.
It breaks down into four simple things, right? We want to first get really, really good at data and technology, right, because that's the core. That's what supports all of these businesses I just spoke about. We want to have the best data, the best decision science. We want to be connected in all the possible different ways to the market. And we want to be safe and secure, obviously, talking about technology. And that core feeds two ambitions in the business side. One is trade credit insurance leadership, which is pretty much building upon what we've built and reinforcing our investments in terms of growth, in terms of underwriting knowledge, in terms of simplification. And then, basically continuing to grow double digits, a profitable business information venture, which is point number three on the right.
All of this building on this unique culture that, I've been describing, one where if you work for Coface, you work for a multinational that is completely connected to world affairs. You work in a multinational, but it's 5,000 people, so you will very quickly have an impact on the world around you. You are obviously very, very quickly, impacting clients because we're not a very big structure. We are fast. We are short-cycled. And then you will be co-collaborating with people from all over the world. So, we have a very unique, I think, value proposition to offer to employees, very unique value proposition, also in terms of, of CSR. And Carole will take us through this because we have defined three, four very simple goals, and we're, we're committed to doing the right thing for the communities in which we operate and for, for the planet.
So this is the same slide, but it really summarizes, and we'll be showing this over the next four years to all of our employees and our stakeholders. This is Power the Core. It's four pillars, and it's 10 points, that we're going to be focused on, you know? And that's going to be the structure for the pitch today. Technology, data excellence. One is building differentiating data and scoring capabilities, investing in technology, and connectivity. That's the core. And from there, broadening and strengthening TCI, which is underwriting with courage and discipline, and Cyril will explain what that means. Stimulating, customer-oriented profitable growth. Nicolas, here, our sales leader, will take you through this piece. Delivering on simplification. I think we'll have Keyvan talk a lot about this.
With Thibault, we're going to be talking about growing business information, double digits, both, more use cases, better data, better sales team, upgrading our IT platform. And then culture. Carole will talk a lot about this on enhancing our employee value proposition and delivering on CSR commitments. That's the structure. This is the plan. Quite simple. A lot of work went into this, but we're actually very excited to enter this new framework. So I'll just take you very quickly through some of the themes that are going to be discussed. Others will do it in much more depth than I will. This one, Thibault will show will talk about it, is about building this differentiating data capabilities, which is at the core of what we do.
I'm not going to go into the details, but it's about acquiring data through a variety of sources, managing and storing that data in an efficient way, being able to derive insights using, you know, best decision science, coming up with solutions that matter to clients, and being able to deliver these solutions in an effective way through a variety of digital tools, again, both for TCI and for business information. That's the core. Thibault will take you through it. The second part is really investing in connectivity because it's great to have a good engine, but if nobody can access it, there's very little purpose. So today, we work with clients through portals or typically, you know, websites. Of course, we got to do this well, but the next generation is about APIs.
So we're developing a catalog of APIs so that clients can incorporate our data into their own processes. We also want to interface this company with the main softwares in the market because clients can choose whatever environment they want or whatever they have. We need to be able to work with them through whatever are the tools that they use in their daily operations, right? So a lot of effort in trying to connect the company effectively to its outside client base. Sustaining trade credit insurance leadership. It's underwriting with discipline and courage, as I said. You know, the world is not black or white. It's usually some kind of a shade of gray. And that, in that gray environment, you need courage to say yes, and you need courage to say no.
That, that's something that we're going to highlight through the rest of this presentation. You also need to leverage technology to get better at this game, right, every day. Every day, tools are coming up, and data's coming up, and other things are coming up that allow you to make incremental progress in the way you can underwrite risk. And we've really got to be on top of this. Customer-oriented, profitable growth. That's about investing in sales, in marketing, and doing it in the right place at the right time, and then delivering on simplification. That's really about completing the work we started years ago of migration to a simpler set of products which will allow us to use the same tools everywhere and cut the time and the efficiency for our client base.
Just want to talk just a little bit more about discipline and courage because that's one of the big questions, right? Coface is a risk company, so aren't you a lot subject to the ups and downs of the environments? The answer is yes, but I think our job is to help our clients trade safely and prevent big mistakes. So we, we're really focused on two things. One is we want to write the right business, and we do not want to write the wrong one, so making the initial decision. And then, of course, we don't get it all the time perfectly. And the environment, as you know, is very unpredictable. So when something happened that wasn't planned, then we need to react very quickly.
I think through the last few years, we've been able to demonstrate our ability to go through some of these crises. We had COVID. We had the war in Ukraine and the Russian situation. We've had some, some pretty difficult times in construction industries and all over the world. We've had pretty much the Mall of America go bust or probably nobody noticed, but you know, most, most large retailers in the U.S. went bust over the course of the last, over the last 10 years. We've been managing this, I think, I would say, pretty seamlessly, right? Our ability to stay on top of those industries, those sectors, those issues, and the ability to say no when presented with quote-unquote "irresistible opportunities," that's really what drives this company. We want to continue to build our global franchise.
You see on the right-hand side the main trade corridors around the world. The blue countries, the darker blue countries, are the countries in which we have a strong presence and direct presence. We have about 600 client relationships that span the globe. And these clients sometimes ask us to set up policies for them in tens of countries. And they are very demanding. They are asking us to be at the borders of the risk empire and to take those risks in those faraway, difficult places to deal with, because that's what they need. And the fact that we trade with these clients requires this but also allows this to happen and gives us an edge in the market. So being in those faraway places is why we are relevant and unique in this industry.
So we want to continue to grow this unique capability. We are developing specific organizations to cater to the needs of Japanese companies or Chinese companies or Korean companies of companies around the world in different industries. And continuing to build on this is critical for us. Mid-market, that's the core of what we do. What you need in the mid-market space is sales organizations that are efficient. You need to reach out. I mean, the world is huge, and we are only 5,000 people. So the challenge for us is developing multi-channel distribution capabilities in order to be able to reach the full potential of the markets. We have to make choices. We think there's an opportunity for us to double down in some specific markets.
We want to leverage partnerships more than we ever have because if we don't have the staff or the capabilities to go after all those opportunities, others do. So partnering with others to do this is the key. And then we, as you know, have both direct distribution and distribution through brokers and distribution where advertising through web and digital means. And we've got to make all of this work together. So that's really the theme here around this. Nicolas will take you through that. Simplification, something we've been doing for now eight years. What we're trying to do is fix the car while continuing to race, right? So, I mean, you got to dose it right.
The chart here shows the migration story from the old product suite, which is the lighter one, and the new product suite, the darker one. The old universe has about 20,000 different legal clauses in usage, 20,000 different legal clauses in 200 countries, 200 different legal systems, 70 different languages, just to give you an idea of the complexity of what we are running. We're going to a suite of products that has much less than 1,000 clauses and is standardized. It means that when you put a policy in place, it used to take months to go through all this stuff, and now we can do it in weeks, right? It's much more error-proof, allows digitization much faster. I mean, a whole lot of benefits. So we're going to be continuing and finalizing that migration here. Cost.
I mean, we are relentless on cost. Cost is a long-term competitive advantage that you need to pursue with determination every year, whether the times are good or bad. It frees up resources to invest in the good areas, and it gives you a competitive edge, which is very useful when things get a little bit more sporty. So, we've been investing in operations centers with hundreds of people located in the places you see on the left-hand side. That allows us to concentrate work from pretty small structures we have around the world into bigger centers. Once we have some more scale, we can actually digitize and become more efficient by introducing technology. That has profound implications.
I mean, I showed some of those numbers here on the right-hand side, but one typical is, how long does it take us to make a credit decision? You know, when I joined Coface back in 2016, we were about a week. It took us about five working days, 4.7, I think, to underwrite on average, a credit line. Today, we do this in 0.7 days. So we've really cut the time by something like a factor of 10. When it comes to putting a policy in place, you can see the numbers. In 2017, it would take us 14 working days. Today, we're at 5. So we do it in a week. And I think by the end of this plan, we can do it in a couple of days.
So this is the kind of gains that we can make when we work hard on process and efficiency. I mean, today, about 10% of our collections is automated. We think we can triple that amount by the end of this plan. Business information. This is something that existed in Coface, in a kind of legacy situation in Israel and in Eastern Europe, basically, pretty much. And when we put our heads towards that, what this meant, we saw an opportunity to differentiate. And Thibault will take you through the whole discussion here. So we started investing in this business, and the market response has been quite encouraging. We've built a sales team. We've started to work on data patrimony. We have developed products. And we have started to invest in technology.
As you can see, we doubled the size of this business, and the growth rate really, really increased. We can do this while remaining profitable. We can do this while connecting directly to the core and while learning a lot on data and on technology, which makes us better in trade credit insurance. So that's the whole idea behind this venture. We think we have an interesting opportunity here to continue along that line in the future. Employer value proposition. I've pretty much, you know, already talked a lot about this, and Carole will take you through more of this, but this is a unique company. It's both completely global. It's not very big. You are very quickly in front of the client or dealing on something that's linked to world affairs in one way or another.
Nothing happens in the world, pretty much, that we're not involved in, hopefully not too much when it's not good stuff. That's, that's what we do. But pretty much when you're in Coface, you open the papers, anything that's true is somehow going to, going to impact you, right? And, and I think that's, that's, we, we have something very unique to offer. Attracting talent, attracting skills is key. This is a, this is a, a knowledge business. This is a, an expert business. Being able to attract the best and retain the best is absolutely critical, given our size. And, and I think this value proposition, we'll talk more about this, is, is at the center of our, of our journey. CSR, something we've, we've been spending a lot of time on. We, we've boiled down our CSR initiatives to three very simple commitments, right?
We have a portfolio of EUR 3 billion of assets, and we want to reduce the carbon emissions linked to that portfolio by 30%. So it's very simple. We're on our way to doing this. We've been very disciplined. Carole will take you through some of this. We want to reduce our own carbon emissions as a company while continuing to grow. So we're going to reduce our net carbon emissions by 11% while we continue on our growth journey. And that's really, you know, in, in our company, it's about offices, heating and, and cooling. It's about transportation. And it's about IT and technology and consumption of energy in that space. So, I mean, it's, it sounds simple. It's harder to do. But, but that's really what we're committed to doing. And then the, the, the third goal is really diversity and inclusion.
And we have committed to reaching 40% or more of women in the top 200 jobs in the industry. You have actually some of our executive committee members here, women that are present. We, we really, we really want to make this a key part of our, of our initiative, and drive our employee engagement score. So we've got a clear plan. We're going to talk about this. We, we, we're committed to making this happen. But maybe, you know, I'm getting on now to kind of the summary of the, of this plan. I think, if I want you to take away one thing here is this is a better, stronger, more resilient company than, than it's ever been. To start with, our P&L is better, right? We, we, we are more profitable. Just a few, a few highlights.
The commissions we receive from the reinsurers market have grown by nine points since 2016. So we have a pool of the most well-known reinsurers, which is very stable. We partner with them as we do with our clients for decades. And they're giving us nine points more of commission, not just out of their good heart, but also because I think it proves they believe we understand this business, and our results are going to be matching this increased demand on the commission side. We're facing an increased interest rate environment. So the returns we get from our investment portfolio have pretty much grown by EUR 35 million annually. We've lowered our cost ratio by 8.5 points. And as a result, we're delivering double-digit returns. So what does that mean?
We start from a better place in terms of absorbing the shocks that might, that might show up, right, which we, we are obviously subject to. We also have a stronger balance sheet. We've reduced the capital consumption of our, investment portfolio by about 20%. We have refinanced our debt for the next ten years, so we're not really worried about that part of, of the equation anymore. We've lowered the reinsurance stop-loss, attachment point, which means we'll be protected sooner in case something happens. It also helps our capital consumption in terms of, solvency. And then we have maintained a, a higher than 180% solvency, which obviously satisfies the regulators but also reassures clients, rating agencies, banks who lend money to us, etc., etc. So, so we are more profitable, and we start from a strong balance sheet standpoint, which means that we are more resilient.
The likelihood that we would be destroying capital in the face of a shock is lower than it used to be. I think that's, to me, was one of the ambitions of Build to Lead. We've been working hard on this because we realized that everybody thought, "Okay, this is a company that is pretty much cyclical." And it's very important to be able to compete effectively when things are not so good, not just when things are good, right? So we are committed to creating value for the long term. And this plan is no change to that. We will be committed to creating value for the long term with Power the Core as we were with Build to Lead. Which leads me to the final slide of my own presentation. Then you'll hear from some of my colleagues.
We have pretty much kept the same financial commitments we had for Build to Lead, except we've improved the targets. The undiscounted combined ratio is now targeted at 78% instead of 80%. The return on tangible equity at 11 versus 9.5. Carine, who used to be our CFO, appreciates, right? We still want to be towards the upper end of the 155%-175% range and then to pay out 80% or more of our earnings on an annual basis. That's for TCI, very, yeah, so no, no, no big change here, just improved targets. And on top of this, we want to build a double-digit growth information services business.
We think we can do that, keep it profitable, actually making it contribute to the returns of the company with a target of 0.5 point of return on average tangible equity in 2027. So that's the plan, quite simple. I hope this is helpful. I'm going to turn it over now to Cyrille Charbonnel. Cyrille is the Group Chief Underwriting Officer at Coface. He's going to take you through the underwriting part of this.
Thank you, Xavier. Do you hear me? Yeah. Okay. So hi. Good morning, everyone. So it's a pleasure to be here. Hello. Hello. Hello. It's okay? No? Yes? No. Okay. Maybe you can hear me even without a mic. No. The webcam can do shift. Maybe try. Hello? It's okay. Okay. Oh. Ow. It's okay. C'est moi.
It's a pleasure to be here. So, just one to start, maybe I have been working in this, in this industry for the last 30 years. I joined Coface 12 years ago, and I am in charge of the underwriting for the last seven years. And I have to say that I'm very proud about what we have built.
I think really that we have created a kind of unique organization in terms of credit risk management and with as man-focused execution. We, it's really what we want to do every day to make it happen. Discipline and courage, that is our daily challenge. Why? Because our job is to find the right balance between too much and not enough, being too shy or too reckless. In a permanently changing world, it's not so easy because we do not have the crystal ball. It's why we need a clear rule of engagement. We need to stick with these rules. We need to have a strong control and strong monitoring. It is discipline, and it is really our day-to-day business. On the other hand, we have to face market changes. We need to adapt ourselves to customer needs. It's also why we need to think.
We need people brains. We need people with conviction. That is courage. So our day-to-day is to balance between discipline and courage and that's what we are doing at the underwriting. To make it happen, also, we need technology. Without the tools, we won't be able to succeed. And we achieved a long journey regarding digitalization. One of the last great projects for the underwriting was to digitalize the underwriting, commercial underwriting process, especially the workflow, and we achieved it end of last year and go live 1st of January this year. So I have to say today that all processes in the underwriting world are digitalized. And having all digitalized, we are ready to make additional progress because we have data, and with data, we can do a lot of things today with the new technology, with AI.
For example, I will give you one example about commercial underwriting we just achieved. Now, having all in the system, tomorrow, we will be able to create new algorithms to help the underwriter, the commercial underwriters to make decisions and to make some proposals and maybe tomorrow to automatize one part of the commercial underwriting workflow, which is not automatized in terms of decision today. It is done for the risk underwriting because the risk underwriting is digitalized for a long time but not yet for the commercial underwriting. So that is something which is ongoing, and we will see that at the end of the presentation, a little bit more about digitalization and technology. But before that, we will have an overview about the risk factors, the way we are assessing the risk with two examples. One about agility, and it will be the example of Russia.
The second will be how we are able to manage the risk in a very sensitive, risky environment, UK construction. And we conclude, as I said just before, with digitalization. Oops. Sorry. So, the risk factors, the way we are managing the risk. We have some very strong principles. Maybe the first principle, it's segregation of duties. People, for example, in charge of risk underwriting, in charge of making decisions, are not people in charge of risk assessment information. So we have people making recommendations. On the one end, we have people making the decisions on the other end. Segregation of duties, it's also, for example, something which is very unique in the industry. We have, on the one end, the sales and the commercial, and on the other end, under the responsibility of the underwriting department, the commercial underwriting.
It means that today, the guy with the pen to make the final signature with the terms and the conditions of the price is not the guy in charge of the signature of the contract. So it requires a lot of coordination, communication, transparency with the sales, with the customers in order to make it happen, and it works. Second principle is the close-to-the-risk principle. We really believe that to be able to make the right assessment, we need to know the environment. We need to know the country, the sectors, what is really happening. So the first decision is made at local level. But we have also, with the close-to-the-risk principle, another one which is close to the customers because for some decisions, we need to understand the customer profile because depending on the customer profile, the final decision is not the same. That was the second principle.
The third one is about the monitoring. We are very systematic on the way we are monitoring the portfolio. So when we are monitoring, speaking about monitoring, there are two things. We are monitoring each and every buyer according to some rule of sensitivity, level of exposure. We are also monitoring the portfolio globally. When we are looking at a specific country, we are looking at the main KPI of the quality of the portfolio. What is the score of the country? What is the percentage of the exposure on the low part of the portfolio, the low risk? We are really looking at the global level, the portfolio, and at the very local level and granular level, the credit limit. Finally, the fourth principle is the transparency and the consistency. We need to. We want to be transparent.
We want to be consistent in the way we work, to be understood by all the stakeholders, especially the customers and the commercial. When we make a decision, the market has to understand why we are making the decision and why we need also, once again, the courage. We need people explaining the decision and, of course, the negative decision, the restrictive decision. I have no need to explain why I'm going to grant 100% of what has been requested. So part of the job, having a global acceptance rate at 70%, it means that we are refusing 30% of what is requested. So it's why we need to explain. We need to be transparent, and we need to assume and to have conviction, as I said in the introduction. So just another point, maybe, what is at stake in terms of volume, it's high-volume business.
So first of all, we are managing EUR 700 billion exposure. It represents a stock of about 5 million credit limits. It's a credit limit request around 3 million per year. So you see, we need the system. We need the robustness of all the organization in order to be able to manage it very quickly. And as mentioned by Xavier, we move from four days something to less than 1 day to answer the credit limit. It's in terms of risk assessment and risk monitoring. It's also an organization having people locally, analysts locally in the field. We have 300 people spread in 55 countries to analyze the risk. So it's a double component, the way we are assessing and we are giving score or DRA to our buyers. First of all, we are buying information, and we are buying score.
Or we produce ourselves the score if we are able to make it to have better scores. And you will have an explanation from Thibault about what we are doing with artificial intelligence to build our own own scores to have better scores in terms of probability of default. And for the main sensitive part of the portfolio, we are making our own manual score, having people thinking about the evolution and what could happen with these specific buyers. So that is a specific point about the monitoring and information. Next one is about, more specifically, about the way we make a decision. We assess the risk. Maybe one key point in our business which is very specific is the fact that our decisions are amendable, are cancellable at any moment. So there is first selection at the beginning, at the entrance.
We have a first decision to make at the first credit limit request. Then we can change the decision if we have new information. It could be positive information. We were restrictive because the last financial was not good enough. Then we received a new balance sheet, much better. We could give more. But on the other hand, we also can reduce or cancel the credit limit. It's why we have this capacity to adapt very quickly the exposure to the reality of the situation and the risk. First of all, we have a very global approach, a macro approach. But when we take a country to assess the final buyers, we need to know the environment and the context. First of all, it is a country. But a country is not only the macro data.
It is not only the growth of the GDP. It's also how we are comfortable to make businesses in country. For example, if I take India, which is one of the faster growers in the world with more than 7% growth in GDP, it's also a country where the justice system is not quite reliable. It means that for us, as credit insurers, it's a country where the recovery rate for collection activity is not very efficient. So I know that I will have a kind of collection rate around 20% in India when in Germany, for example, not such as a fast grower, as you know, I will have a recovery rate around 90%. So it changes also the view we can grant a credit limit according to this kind of comprehension of a country. Then, of course, after the country, we have the sectors.
So we know the country. We are in specific sectors. And then depending on the evolution in these sectors, I can adapt my decision. For example, if I take a steel retailer, depending on the evolution of the price of steel, I will make a different assessment and validation decision because I know that the stock, the value I can assess the stock is not the same if the prices are decreasing or increasing. So we need to know the sectors. And of course, at the end, we have the buyer itself, the debtor. So we can have the final if everything is perfect, we have the financials, the last update, and everything is fine. But also sometimes, we need to be a little bit smarter to get additional information to be able to make the correct decision.
That's the main way we are making the decision to grant a credit limit. But it is not the final process because, as I said, we are close to the risk. That was the first three boxes. And then we are also close to the customers. Depending on the policyholders, we can adapt the decision. I will take one or two examples. For example, of course, if I have very large customers with, for example, an aggregate first loss, a big franchise, and very profitable historical with this policyholder, I can make a decision on very borderline buyers. For small policyholders, I won't grant any credit limit. So we also take into consideration at the end the profile. We need to combine the risk profile and the policyholder profile.
So then we will move to an example which is the agility and the way we can implement very quickly mitigation actions. And it's the case of Russia. Everybody knows what happened in Ukraine with the situation in Russia. How we manage this crisis when it started in February 2022. First decision, we freeze, we freeze all the exposure very quickly. Then we decided, and it was very quickly to do without having specific communication with the policyholders, we remove all the main sensitive exposure. It means exposure on DRA 04. And then we decided to remove 80% of the remaining exposure, so globally 90% from the beginning, in a six-month period. And we created a dedicated team, a task force, in order to implement it in full transparency with the policyholders, so with the commercial, with the sales.
So with Nicolas and all the team in every country, we organize meetings. We explain what we will do in order to make it understandable and manageable for the policyholder. Because one thing to have in mind is when we make this kind of global decision, it has a huge impact on the credit management service of our policyholders because they are used to receive one negative or two negative, three negative answers every day. So I have one client with a reduction or a cancellation of credit limit. And when I have to manage hundreds of decisions, negative decisions in one day, it's not manageable, and we create some dissatisfaction. So we try to adapt and to phase this kind of action in full transparency and also to make it happen in our system. And as you see, very quickly, we achieved what we wanted to achieve.
It means that we reduced by 90% in less than six months' time our exposure in Russia. So it shows that we are able to reduce very quickly our exposure. Second example, it's not at all the same case, is how we are able to navigate in a very complicated, uncertain environment. So that's what the world is today, uncertain and complicated. So for example, we took as an example the construction sector in the U.K. First of all, the U.K., kind of a double punishment with the COVID and the Brexit. And when an economy is not very strong and under pressure, usually, the construction sector is suffering a lot. And it's what happened in the U.K. But it started very early.
If you remember, for those who are aware about these sectors, I think it was the end of 2017, we had a very large insolvency in the U.K. which was Carillion, more than GBP 7 billion a turnover, a very large company. But it continues to be very difficult. You see, for example, one factor of the difficulties was, of course, the sharp increase of the prices and the cost. But every year, it's very difficult in the sectors. And when we look at the evolution of the insolvency, last year, for example, you see that in the subsector of what we call the construction, we had a growth, for example, for the architectural +74% or the construction itself where we are more exposed +40%. And it's a huge number. And it is not only very small and medium company.
For example, I put some names on the slide. You have some not so small players on construction, GBP 400 million turnover, Buckingham Group, GBP 700 million turnover, etc. On these buyers, we had no losses. We were able to avoid and to anticipate the difficulties to come. That's one of the characteristics of the monitoring system and the expertise. We are able to manage this kind of very tricky situation and having, as a result, a good loss ratio or not so bad loss ratio. When you look at the evolution of the losses in this specific sector in the U.K., you see that we are very stable in terms of losses between seven and ten with an exposure around EUR 3.5 billion. It means that a claim on exposure around 0.2% which is more or less the standard. We do not have, at the end, more losses.
We do not have a bad loss ratio in this country because we are, first of all, able to manage the risk correctly, to set the right terms and conditions. Of course, the contract and the price will be a little bit higher. Of course, maybe I will be a little bit more demanding in terms of setup, asking for deductible, for franchise in order to have a better risk sharing in the contract. But we are fully able to manage this kind of situation. The technology digitization journey. We invest a lot over the last years to improve and to have something very efficient and very operational. As I said, one of the last large, big projects was the digitalization of the commercial underwriting part which was manual in a way. Now we have all our processes and workflow fully digitalized.
In terms of productivity, it opens some doors. In terms of controlling, in terms of introducing new technology from AI, we have a lot of things to do. It's something which is very exciting about what we could do tomorrow with underwriting. On the risk on the underwriting itself, we also have a lot of room for improvement. For example, two examples here, we will launch a project in order to work with generative AI to try to propose some explanation about score variation, why it is a score of six and tomorrow and five, four, I don't know. But to explain this variation and also to explain, for example, the decision. It is a little bit more complicated. But I think that there is a lot of things we could do tomorrow with this kind of thing.
Another thing also which is very interesting is one aim is to be much more granular in the way we are managing the risk and we implement the prevention actions. As I said, when we are analyzing, when we have a credit limit request, we take into consideration both the policyholder and the buyer itself. But for the current monitoring, to monitor the five million buyers we have in the database, we need to automate. We could improve this kind of double approach. The idea is also to create tomorrow a score giving us this kind of double view. Okay, for this specific credit limit for this policyholder on this buyer, we propose the machine is proposing to change the credit limit. So to have very detailed, very granular information. So we have really a lot of things to do.
So I think that with all what we have done regarding to the technology, the digitization, with the investment we start to do and we started to do regarding AI, we have room for improvement regarding efficiency and productivity. As a global conclusion, I just will say that I truly believe that we have the right organization, the right product, the right people with the right mindset in order to cope with the uncertainty of this world. We are ready. And just I will quote a very short sentence from Shakespeare, Hamlet, Act V, Scene II: "Readiness is all." I think it could be the motto of the underwriting. Thank you.
Okay. Does it work? Yeah? Great. Okay, just before the break, I will hopefully keep you stimulated because we're going to talk about how we are going to stimulate our profitable goals within the Power the Core plan. But just to start, I would like to share with you an executive summary here. Within Coface, over the last years, we have created the foundation for future goals. We did that by transforming the way we've been working on the commercial side. What we've done is that we changed the culture of our sales organization. We changed our organization itself. And Cyrille mentioned it, especially by differentiating underwriting and sales. But more than that, we changed also what people were focused on. We also implemented the sales force effectiveness program within our sales organization to enhance the efficiency of our commercial activities.
We've done that by rolling out a new product suite around the X-Liners. I will tell you a word about that. We have continuously improved the client satisfaction. Going forward, what we want to do is to continue to develop a strategy that is differentiated, a growth strategy that is differentiated according to the client segment from the multinational companies to the mid-market and you heard to the SME markets. We will do that also by leveraging a multi-distribution strategy, a multi-channel distribution strategy, and by continuously innovating in the way we are serving our clients in order to keep their level of satisfaction at the highest level. Let me explain to you now what we've done and what we want to do within this plan.
So I mentioned we transformed the way we've been working on the commercial organization and maybe sharing with you what we've done in terms of restructuring and the performing sales within Coface since 2016. You see here that our sales force has decreased by 9%. But in reality, we have taken very different actions from one place to another. Let me give you here three different examples in three different geographies. Let me start with Germany. In Germany, we have a regional organization across the countries with not really a clear organization, a mix between hunters and farmers activities within the same person. So what we did and a lot of low performers. What we did is that and nowadays, we have a much clearer organization with a clear differentiation between hunters and farmers. We let go a lot of low performers, and we penetrated new blood.
We embedded new blood in the organization. The second example I want to share with you is USA. In the U.S., and Oscar has been instrumental in doing that, here you are, Oscar, we had a network of regional agents. We had little control on their actual performance. What we've done is that we internalized these agents, let go a lot of low performers that were basically sitting on their book, and here again, introduced new blood. We also created a broker team. We put all the broker management within the people dealing with brokers under one management so that our brokers, partners in North America, are having a one-stop shop. In France, third example I wanted to share with you, we also had an organization, a regional organization. It was not optimal. Here again, we created a broker desk.
We put all people working with brokers under one management and one leadership. We redesigned the sales territories of our sales force across the country. We also fed this direct sales force with more partnerships in order to provide them with qualified leads. All in all, finally, what we did is our sales force has declined by 9% over the last years. We've regained positive commercial momentum during this period also. More globally, what we did is that we created a toolkit for our countries to implement and to work with. This toolkit, the implementation of this toolkit led to an increase of the productivity of the efficiency of our sales force, as you can see here, by more than 30% over the last five years. This toolkit is built around three main pillars. The first one, people.
I mentioned that we separated hunters and farmers. We made sure that these people were focused on their main objectives with the new incentive plan. The second pillar we implemented is around distribution channels. In the example I gave you just before, I mentioned that we created broker desk, broker teams to deal with brokers, to be focused on dealing with brokers. We also developed our direct sales force, and they were managed as a direct sales force. It allowed us also to improve the way we were partnering with brokers. With our sales force, it allowed us also to focus on giving them partnerships agreements that would give us qualified leads. The third pillar is around tools and technology. We have implemented over the last three years a modern CRM tool for our sales force. That is really a game changer for us.
We also implemented, actually, an artificial intelligence-powered engine to detect clients that were potentially will leave us. And it's really critical and efficient when you talk about smaller clients like SME clients where we have less touch points than our bigger clients. So all this led to this increase of efficiency in our organization across the globe. In addition to that, and Xavier mentioned it already, we have rolled out our new product suites. So you know the oldest Coface organization is 100 years old. And over the years, we have over the decades, we have accumulated different layers of different types of contracts. And Xavier mentioned it, more than 20,000 clauses. Actually, we are not even sure about the number because it's the accumulation of historical complexity. So what we have decided is to simplify this over three main products.
Let me start with the first one, TradeLiner, which is a core product to serve our mid-market clients. TradeLiner is a trade credit insurance policy. But it's a much clearer wording. I think we have taken all the experience of how to make this insurance policy clear. I do recommend that you read it before going to bed. It's quite exciting. And you will understand everything on it. But more than just a wording, it's also a closed library that is much more controlled. We know what is in the clauses, the closed library of TradeLiner. So today, we have migrated more than 90% of our mid-market book into TradeLiner. And our ambition within this plan is to finalize this migration by 2027. Let's move now to GlobaLiner for our multinational clients.
GlobaLiner, it's a product actually, it's a series of local TradeLiners to cover local entities of our multinational clients that are linked with an umbrella contract. We launched GlobaLiner a year and a half ago because we needed to have TradeLiner established in most of the geographies of Coface and having a big enough library to cover our multinational clients' needs. So now the product is launched, and we have started the migration of our portfolio into GlobaLiner. Our ambition by 2027 will be to have 80% of this book migrated by 2027. On the other side of the scope, you've got EasyLiner for the SME segment, SME companies. EasyLiner, it's a simplified trade credit insurance policy. I mean simplified, but we still have risk prevention in it, debt collection, and indemnification. But in a much more easier way and shortened way and basic way, actually.
There's no customization under EasyLiner. Here, we have launched the product in a series of countries. We want to develop it to penetrate more the untapped SME segment. I will tell a word a bit more after that. In parallel to restructuring and increasing the efficiency of our sales force and in simplifying our book of policies, we worked to improve the client satisfaction and the quality of service on a daily basis. We are measuring it on a monthly basis with the Net Promoter Score. This is the feedback of our clients. As you can see, over the last three years, our Net Promoter Scores have increased from 10 to more than 45. We did that while keeping a very disciplined underwriting. You know, as a commercial director, I like having happy clients. How we did that?
Of course, we work in reducing the time to answer to our clients' requests, credit limits, requests on amending their policy, time to offer, et cetera. But more than that, behind this improvement, we have established a routine of our team to listen to the feedback of our clients. How does it work? At the country level, our country leadership are calling every month the clients that are providing feedback to listen to them, to understand what they told us, and to fix or rectify anything that needs to be fixed in a local process. And this routine became a kind of cultural routine within our organization. And really, on a monthly basis now, our teams, commercial and leadership team, are really measuring, listening, and acting in order to make sure that we have satisfied clients here. So what's next?
So for the plan, what we want to do is to stimulate profitable growth. We want to do it by using four main priorities that are, for me, the real key priorities we're having for the next years. The first one was we want to continue to strengthen our unique Coface Global Solutions franchise for multinational companies. The deployment of GlobaLiner will help us in doing that. We want to drive a multi-channel distribution, an active multi-channel distribution strategy to boost the growth of our mid-market book. I will explain how we do that. We will continue to innovate it to enrich our product offering, especially by investing in EasyLiner to penetrate more the largely untapped SME markets in our key markets. The fourth pillar is around keeping improving the customer journey in order to keep improving the client satisfaction.
Our ambition by 2027 is to accelerate our new business core generation, especially on the mid-market space, while keeping clients at a high degree of satisfaction because it's a key element to retain them. And as you saw in Xavier's slides earlier, new business and retention are two key components of our portfolio course where we have most control, in fact. So let's move now to the multinational segment, to Coface Global Solutions, CGS. As I mentioned, we've got a unique franchise that was built over the years. And it's really on the DNA of Coface, this segment. And it's been possible thanks to our global footprint, which is the largest in the market, this capability to operate in these 200 countries, and also by having dedicated, over the years, experts to serve these clients, both on the commercial side and on the underwriting side.
With GlobaLiner, we will deploy a new tool to manage these programs in a much more efficient way. Here, efficiency means, obviously, better and faster time to respond to our clients' requests and also to have a better efficiency in managing these programs for our clients. We also believe that there's still room for growth in these sectors with Asian multinationals that are headquartered in Japan, in South Korea, or in China. Here, we will keep investing to boost our book by putting more people close to the HQ of these groups and close to their local operations. Let's move now to the mid-market portfolio and growth. Here, we want to drive a multi-channel distribution. Why is that? Well, I don't know a mid-market company decision maker waking up in the morning and saying, hey, today, I want to buy credit insurance.
If it does exist, Cyrille will find this very suspicious. So we lie. So we have to go and to present our solutions in front of these decision makers. But we have a limited sales force. And Coface is only 5,000 people. So to do that, to multiply the opportunities to present our solutions to mid-market companies, midsize companies' decision makers, we need to multiply the opportunities to present our solutions. And we do that by leveraging multi-channel distribution. Let me start with brokers. Brokers is the historical channel. Specialized brokers is the historical channel to distribute trade credit insurance. But the broker landscape has changed a lot over the last years. So what we want to do is to better differentiate our servicing according to the actual brokerage house needs. That can be very different from one to another.
We want also to simplify their life by having more machine-to-machine connections so that they find it easier to work with Coface in managing their portfolio. In other words, we want to be the partner of choice of the brokers. The second main distribution channel, I mentioned, direct sales force. And here, we want to go especially where brokers don't go. And we want to double the sales positions in our key markets in order to increase the boots on the ground here. We will feed them with upgraded lead generation capabilities. And a way to give them qualified leads is the third pillar you're finding here, which are partnerships. Partnerships is a way to provide to our sales force, direct sales force, very qualified leads. When I say qualified leads, it allows us to transform with a higher rate prospect or even targets into a client.
We want to reinforce partnerships in more markets. Let me give you an example of successful partnership. Here, we have taken an example in France where we used to have a partnership agreement with a big French retail bank. But it was almost dormant a few years ago. So what we've done is that together with the leadership of this bank, we've realigned on our strategy. We've revamped the partnership agreement. Together with our sales force, we have animated this partnership in the local agencies of this retail bank. The local agencies are providing qualified leads to our direct sales force. Thanks to that, over the last four years, we have multiplied by 2.5 the book generated through this partner. There's a lot of things to give better qualified leads to our sales force here.
We also believe that we can stimulate our profitable growth in the mid-market space by innovating more. And let me give you here two examples. The first one, EasyLiner. Xavier showed us the SME segment is the most untapped segment. Still, it's the blue ocean here. So we have created EasyLiner, which is already in place in a certain number of geographies, this simplified wording for SME companies. And we started to digitalize also the customer journey around that. We want to finalize completely this digitalization of this customer journey. And we want also to use it, EasyLiner, as a way to facilitate partnership agreements because we believe the right distribution of this should be backed on partners to get access to their book and to leverage on their distribution capabilities. So it's already in place in 12 countries where we want to develop more partnership agreements.
We will extend to five additional countries this type of distribution with partners. The second example I wanted to share with you is around connectivity with our clients. Keyvan will tell you more about the way we can connect with our client's system. It's Coface system connected with the client system and communicating on a real-time basis. Here, we have started a test with credit management software systems as an example named Allix. We started a test a few months ago. That seems to be promising. We will continue to invest and to test these types of solutions in order to facilitate the life of our clients and to bring them more service in a real-time basis. As we did in the previous plan, we will implement this strategy in a differentiated manner according to the reality of the geography.
Here, we have three types of countries, of geographies. Let me start with the one at the top here. Big markets growing and where Coface has been growing faster than the market. Here, we have a proven track record. We want to fuel the growth by keep investing in this distribution. A good example of that is Italy. The second category of countries are countries where we have restructured and transformed our commercial organization and where we believe the market's potential is big. We didn't take the share of the growth we should have over the years because we were focused on restructuring our sales force. We believe these markets we are now ready. We want to invest to bridge the gap in our distribution capabilities. A good example of these markets is North America, U.S. especially.
And then there's a third category of countries where we still have some internal homework to do that is being done. And hopefully, in a few months' time, we will be in a situation where these countries will be turned into the second category of countries. And it will be time for us to accelerate our investments, typically the U.K. here. So before leaving for the break and to wrap up, I just would like you to remember three things. We will stimulate profitable growth in Coface by doing these three things. First, we will keep capitalizing on our unique Coface Global Solution franchise. The second thing is that we will boost the growth of our mid-market segment by leveraging a multi-channel distribution strategy. And the third element is around innovation.
We will keep innovating to simplify the customer journey of our clients, whatever is their segment, and to keep their level of satisfaction at the highest level in this industry. Thank you.
Thank you, Nicolas. So as you said, we take now a 20-minute break. We will start again at 10:00 to 11:00. Thank you.
Is what we've done, where we stand, and what our ambitions. As Xavier mentioned in his introduction, Data and Score are at the heart of our strategy because these are two critical elements, two elements of differentiation for Coface, both in business information and in credit insurance. So where do we stand? We have built a remarkable data asset. We have 200 million companies that are referenced in our corporate database. We build our own information, we produce our own information, but we also source information from high-quality information providers.
We enjoy a robust scoring methodology that was developed to support our credit decision-making in insurance. We're continuously upgrading our models, and as we develop new techniques, we're incorporating new techniques like, for example, artificial intelligence or machine learning. So what are our ambitions? What are our priorities going forward? One, regarding data, we'll continue increasing the data quality and the data coverage of our database. Second, we'll increase the data accessibility and reduce the response time because data accessibility after data quality is probably one of the most critical parameters and decision-making parameters to select an information provider. Third, regarding score, we'll continue upgrading our score performance. We'll continue investing in score capabilities. But on top of that, as Cyrille mentioned it for a second, we'll also invest in explainability.
It is important that we provide our clients with automated solutions to explain the level of our scores, but also the evolutions of our scores. So on this page, we have described our data model. Our data model is the way we think about data. It is actually supported by an integrated set of techniques and capabilities to source, transform, and deliver data, both for business information and for credit insurance. Let me walk you through the different steps of this data model. First, it starts with data sourcing. We relentlessly look for the best sources of information in each country. We can use internal data that our 15 production centers are producing across the globe, or we source data from a network of 50 also information providers that we have selected for the quality of the information that they produce. Second step is building gateways.
We build gateways to access these different information sources. One thing that is important to have in mind is that on one company in one country, we can access different sources of information. This is multi-sourcing. We can simultaneously retrieve and combine information about one company from different sources. This is a technique that proves to be quite efficient in countries where data quality is low or when information is scarce. Third step is data management. It is actually the engine of our data model. It consists in defining categories of data and then processing this data through different types of analytical tools to produce solutions, to produce our solutions, to produce scores, to produce Credit Opinion, to produce indexes. In trade credit insurance, once again, as Cyrille mentioned it to you, our DRA, our own score, our corporate score, is absolutely critical in the underwriting process.
It is one of the key elements upon which our underwriting are basing their decision-making process, they're deciding on their credit limits. In business information, Credit Opinion and scores are really at the heart of our product suite. Last step is delivery. We deliver these products, we deliver these solutions through different sources, through different media. It can be different formats. It can be simple files. It can be data flow through APIs, or it can be web portals. So as you can see, this model integrates several techniques and capabilities. Really, I think that one thing that you have to keep in mind is that all these techniques and capabilities represent some of the major entry barriers that we have at Coface. Now, let me focus on three elements of this data model as they're quite critical for our strategy. One is our data asset.
Second, the way we source data and our scoring capabilities. As I mentioned it earlier, we have one of the largest databases in the world. In this database, we have almost 200 million reference companies, and we have tripled the size of this database since 2016. I mentioned and I said reference companies because for each company in the database, we have one single unique identifier: our Easy Number. A unique identifier is something that is critical in data management because it is probably one of the best ways to quickly identify a company and with certainty. It also helps reduce the time to access the data in the database and avoid redundant information in the database. As you can see on the right-hand side of this chart, we have structured data along three types, I mean, three categories of data. One is identification data.
Obviously, here we're talking about the name of the company, but in lots of instances, the name is not sufficient, and we have to access other information to ensure an effective and rigorous matching of information. Like, for example, the address of the company, the legal form, the legal ID whenever it is available. But it can also be also the activity or the trademark of the company. The second category of data is critical data. Critical data are really the inputs that we use in the assessment and the evaluation of each company. It's obviously the financial information we can collect about a company. It is our proprietary payment experience that we derive from our credit insurance business. But it can also be company links when a company is within a larger group, or it can be compliance data.
Third category is complementary data, which actually are here to enrich the knowledge that we have about a company. That's especially true when critical data is not available. Here we're talking, for example, about the number of employees. We're talking about the management team. We're talking about the product and services that are produced by the company. We're talking about the major clients when we can have access to the name of these clients, or the banking details once again when we have access to these details. We also have a rigorous methodology and governance to source data. As I mentioned it earlier, we rely upon internal and external sources of information. We rely upon our 15 production centers that collect information and produce reports on companies in more than 20 countries across the globe. We also source information from external information providers.
These information providers can be either large groups that have a large international footprint like Dun & Bradstreet, or it can be local players that have an outstanding data quality in one specific country. For example, Cerved in Italy can be Serasa in Brazil, just to name a few of them. The selection criteria that you have on the right-hand side of this chart is focusing on, say, three types of criteria. One is coverage and completeness. Coverage meaning the number of companies that are recorded into the database of the information provider. Completeness is how much critical and financial data we can access to each company that is recorded in the database of the information provider. Second is accessibility. Here we're talking about we connect to the database online or offline. We retrieve information online or offline.
It depends also on the response time for the information provider to respond to one of our requests. Third is monitoring. As you could understand in the description Cyrille gave you, monitoring is something that is quite critical. It consists in especially with what frequency the information provider is going to refresh the information that it pushes into our system. It's also a critical element to access any alerts provided by the information provider in case of negative events or any adverse situation that the company is facing. I think that one thing that also I would like to insist on is that through this sourcing process, we have managed to reduce the cost of data by 7% since 2019.
So as you can see, rigorous sourcing is quite important to ensure that we have access to the best information provider, but also that we feed our system, our models, with the best possible data. Coface has been investing in scores and is continuously improving the performance of these scores. As I mentioned it earlier, scores represent the cornerstone of both credit insurance and business information. In credit insurance, because the credit limit that is delivered by underwriters is based upon, among other parameters, but is based upon the score that we produce on the buyer that we're going to cover. In business information, because our score, our DRA, is really at the center of the product suites that we offer our clients in business information. So one question that people ask very often is: Why is our score so unique? Three things. Four things, actually.
First, because it is processed out of financial information and payment experience. The payment experience that we produce in credit insurance. And not that many, if any, information providers can have access to this payment experience or something similar. Second, our score integrates business rules and the credit experience of the 400 risk analysts that we have across the globe and the experience that was accumulated over the last 80 years. Third, because our score is homogeneous and consistent across geographies. What I mean by that is that when we give a score or when we access a score of 6 about a company that is based in Hong Kong, a score 6 in New York or in Paris is going to be similar to it. We have the same probability of default associated to the score 6. Same for other types of scores.
Last but not least, because our score is based on the latest modeling techniques. We relentlessly invest in these modeling techniques. We improve our scoring capabilities. We also have put in place a tight monitoring governance around our score. This tight monitoring governance aims at checking and monitoring both the performance of our score and the stability of our score. As a result, we have evolved our score in the major countries where we're present. As you can see on the right-hand side of the chart, we have through new techniques, especially machine learning and artificial intelligence, we have managed to improve the performance of our score by 5-20 points depending on the country. Just to summarize, we have a remarkable corporate database, remarkable data assets. We have a robust data model. We have proven capabilities in sourcing, data management, and scoring.
These are the areas where we'll continue investing in the new plan. So what are our priorities going forward? Three main priorities. One is we'll continue rigorously selecting information providers to ensure best quality of data and the best possible coverage. We'll also invest in continuing rolling out our multi-sourcing techniques. Second, we will build a data lake that will be accessible for both business information and credit insurance to improve data accessibility and reduce response time. We aim at shorter turnaround time in delivering business information and credit limits to our clients. Third, we'll continue investing in modeling techniques and continue improving the performance of our score. But on top of that, we will invest in data explainability, in score explainability, because we want to provide our clients with a rationale for any score evaluation or any score evolution. What are our ambitions for 2027?
Best-in-class global corporate database and industry-leading score performance. Now we'd like to deep dive on business information and give you an overview of what we've done over the last four years and what our priorities are again going forward. As you'll recall, business information, developing business information, was one of the pillars of our Build to Lead plan. Four years later, we have made business information our core business, our second core business for Coface alongside with trade credit insurance. We've been growing this activity double digit, and it is profitable. In this presentation, I will focus a lot on the value proposition that we have developed over time, show you why it is attractive and differentiating, and I will outline the priorities for the next four years. Regarding our value proposition, a couple of things. One is the fact that we sell insights.
We sell our assessment of the creditworthiness of a company. We don't sell plain data. We do that on a global basis. We do that on a worldwide basis. This value proposition obviously leverages our trade credit insurance platform and underwriting expertise. Our growth has been double-digit, which in my eyes is a very good validation of how that is relevant to our clients. Going forward, a couple of priorities. One is we will continue building our commercial platform. Second, we will invest in data and technology to support the growth of our business going forward and continue increasing the quality of service we deliver our clients. We will continue expanding our product range, very much focusing on credit risk and supplier risk.
And last priority, and I will come back on that and detail it, we will maintain a tight cohesion between business information and credit insurance. Regarding our value proposition, as I mentioned it earlier, we see it as simple though differentiating. Once again, we provide our clients with insights. We provide our clients, we sell intelligence about the credit worthiness of a company. We sell our assessment of the financial strength of a company. We sell score. We sell credit opinion. This is quite different from what other information providers are offering their clients, which is more focused on raw data or financial reports. We provide this information, that's the second element of the value proposition, we provide this value proposition on a global basis across the globe. And therefore, and as such, we offer a one-stop solution to our clients.
Last, we deliver this service and this value proposition through simple tools, through APIs. So as you can see, this value proposition leverages the asset and scoring capabilities that I developed in the previous section. There are almost 200 million companies referenced in the database, our scoring capabilities, the expertise of our analysts across the globe, and so on. In fact, I think that one thing that everybody has to have in mind is that in our opinion, trade credit insurance and business information are two different ways to monetize the same data assets and the same underwriting expertise that we have developed initially in credit insurance. Another aspect that is important is that our business information also benefits from Coface's image, brand image, and reputation in the credit risk industry.
Clients trust the information that we sell them because they know that this information that we provide them with is the same information that we are using to manage our EUR 700 billion balance sheet. I mean, they know that we have our skin in the game, and this is something that is quite compelling to them. Regarding our product range, they're very much focused, and they have been very much focused from day one, on credit risk management because this is where we have the most data and the most expertise. Our offer leverages the different sources of information, sources of data that I mentioned in my previous section. I will not come back on detail on that. Data identification, financial information, obviously the payment experience, which really creates elements of differentiation, company links, macroeconomic data.
The core of our product range is focused on credit opinion and Debtor Risk Assessment, our score. One thing that is also important is that we also sell Country and Sector Risk Assessment, which is our own assessment of the different trends and forces at work in a sector, in a country. This is a good way to give a broader perspective about a company or the overall environment of a company seen from a country standpoint or a sector standpoint. Last, our products are delivered through either simple files, once again through APIs, or through web portals. We actually launched in 2023 our URBA360 web portal that provides on any company in the world a comprehensive view about the company's situation.
Its financials, the score that we have calculated on this company, our credit opinion, the evolution or the dynamics in the sector where the company operates and the country where it is sitting. Our client base cuts across many different sectors. From agriculture to electronics, chemical, textile, pretty much any kind of sector is interested or can find a use case in our value proposition. Second, our offer addresses many different use cases. I mean, obviously the majority of our use cases are related to credit and supplier risk assessment because our products are designed to assess the creditworthiness of either a client or a supplier. Another aspect that is important is that our scores and credit opinion are meaningful and are bought by obviously non-insured clients but also insured clients.
They're bought by insured clients when either these insured clients are using our information to manage their trade credit insurance policy, when they want to use our information to manage our DCLs. But there's another use case that is quite interesting in my opinion is that lots of companies are using also our information to monitor the strength and the creditworthiness of non-insured clients. I mean, I have an example in mind of a large multinational that had a global contract in credit insurance, but the global contract was very much focused on the limited number of subsidiaries that were located in countries that were perceived as having the higher level of risk. At the same time, the company had bought a global business information contract so that it could monitor the client portfolio across all geographies, insured and non-insured.
Clients also use our information to assess new clients, to identify new clients, or to assess the strength of prospects. For financial information, we also have financial information that buy our information either to enrich their data assets or to benchmark their own models. As you can see, we're relevant in many different situations. The strategy that we've launched in 2019 has significantly boosted our growth in business information. Before 2019, as Xavier mentioned in the introduction, we are already present in business information but on the limited geographic scope, mostly Central Eastern Europe and Israel, and more importantly on limited, I would say, business ambitions. We are very much focused at that time on collecting financials about companies and producing reports, financial reports, what we'd call today plain information.
In 2019, we have, as I mentioned it earlier, we have repositioned our strategy towards more insights, towards more value-added products, as I explained it earlier. Over the period, we have massively been growing our sales force, and we have invested in our data assets, as you can see on the right-hand side of the chart. As a result, we've doubled the yearly new generation, new business generation between 2021 and 2023. We have tripled the size of our client base, and we've been generating a double-digit growth, which in my opinion is quite remarkable because we're talking about an industry that is more used to single-digit or even lower single-digit growth rather than double-digit growth. There are actually very important discrepancies between countries when we talk about growth. I'm not going to go into the detail of this page.
I would just like to leave you with the understanding about the fact that on what we call the established countries, these established countries enjoy the higher growth, and this is where we have our business information presence is the more mature. These countries, these established countries, share three common characteristics. One is that our sales team is in place, and we have a strong leadership in these countries. Second, the Coface brand is known, and Coface is recognized as a specialist in credit risk management. Third, in these countries, we have high data coverage and a good data accessibility. That's the reason why on these countries we've been resultantly investing and growing our sales force and our infrastructure because this is where we have the best return and the fastest return on our sales ramp-up. In other countries, it's been taking a little bit more time.
Growth has been slower, but we continue investing as well because we have to raise the level of maturity of these other geographies. One last comment, which I think is quite important also to have in mind, is these established countries in business information are also the more mature countries in trade credit insurance. This is where we have the highest penetration rate, and this is also where we have the lower growth rate. To that extent, developing business information is quite a good contracyclical approach, and business information in these countries proves to be a good alternative growth lever. Now I'd like to spend a few minutes on our model. Our business model in business information maximizes the synergies between business information and credit insurance while keeping sales forces separated and specific to each business line.
I think that regarding shared assets, we have data, analytics, relationship with information providers are common to business information and credit insurance. The regional and local functions, as well as leadership, are supporting both business lines in order to maximize the cohesion between the different teams of Coface. And third, the BI brand, the business information brand, owned by Coface, is leveraging or is benefiting from the Coface brand umbrella. Conversely, product, tools, go-to-market, sales forces are separate and specific to each business line to maximize sales efficiency. I think that this business model strikes a good balance between, on the one hand, maximizing synergies and on the other hand, keeping focus and efficiency.
It reinforces the idea that business information and credit insurance are the two core businesses of Coface, that actually they're the two sides of the same coin, and incidentally that business information is here to stay and is not meant to be spun off. Now I think that it's quite clear for everyone now that business information helps credit insurance, and credit insurance helps business information. Sounds simple, logical. But I think that everybody that has started a business knows that building a new activity alongside a well, mature, established business is something that entails major challenges. Our culture and organization has been very, very effective in ensuring a tight cohesion between these two activities.
I think that beyond the support from Xavier and my colleagues in the management team, and in order to maximize the cohesion and to avoid frictions between business information and credit insurance, we have made country CEOs and regional CEOs clearly accountable for the results of both business information and credit insurance in their respective geographies. We've also trained the new business information people on credit insurance. Conversely, we have trained credit insurance people on business information in order to avoid any reluctance to change and to address the concern that they had about this new activity. We have explained how business information operates. We have walked them through the different use cases that we have in business information. We have also explained why business services are meeting client needs.
But I think that probably one of the most important aspects of this kind of global education was to explain why business information does not cannibalize trade credit insurance to the country. We also have explained to the teams why a nascent business requires a disproportionate amount of attention and investment. I think that by now, four years later, everybody understands that once again business information and credit insurance are monetizing the same type of assets and expertise. But I think that they also understand in the low-risk current, in the current low-risk environment, that business information proves to be a quite good contracyclical activity and a good growth driver. So our ambitions going forward: one, continue strengthening our commercial setup in size, in quality, and execution, and also diversify our distribution channels. Second, further improve our data assets in quality, in coverage, in accessibility.
Third, invest and revamp our IT system to support our growth going forward and continuing delivering high-quality service to our clients. Fourth, continue expanding our product range, always focusing on credit risk and supplier risk management. Our ambition for 2027: double-digit growth and a profitable business. Thank you for your attention.
Hello everyone. I hope you hear me well. So you noticed that technology, data, and connectivity are part of keywords in the different presentations. So we are going to talk to you about what we have done during the Build to Lead plan and what we are going to do for the new plan. We plan to invest EUR 80 million in technology during the next four years, focusing on robust and secure information systems, global solutions, streamlined data management, upgraded services, and strong client connectivity. Connectivity is our new norm, and we continue to diversify our set of applications and to offer integrated software for efficient trade management. During the Build to Lead plan, we achieved significant improvements in our tools and processes in line with the plan objectives in terms of resilience, service quality, operational efficiency, modernization of our information system.
On the infrastructure side, we reduced the complexity of our application ecosystem by replacing outdated business tools with new software packages and new internal developments, leveraging several programs of deployment of the group tools. With an opportunistic cloud approach and preferring the software as a service solutions, we managed to leverage the benefits of cloud computing, moving from EUR 80,000 in 2019 using cloud services to more than EUR 4.4 million this year. We adopted also the microservices architecture principles for our new projects, enabling us to have a greater scalability and flexibility in our information system. The number of IT systems has been reduced by 40%, resulting in productivity gains and higher performance, leading to the reduction of the complexity of our information system index by 25%.
On data management, with the implementation of Data Office to oversee and coordinate data-related activities, we developed an IT data platform which is consistent with the latest market developments and market trends, with the creation of a virtual data lake and developing data management features such as data directory, data lineage, data quality, and improving our data governance across the company. On service quality, adopting state-of-the-art IT solutions and systems improved the IT development process and reduced the time required to address and resolve incidents, therefore having a better service quality. You heard a lot about connectivity, which goes with capabilities to enable the exposure and consumption of Application Programming Interface or APIs.
Of course, with new cybersecurity tools and approaches, we have been able to improve our NIST, National Institute of Standards and Technology, cybersecurity maturity model score, and to be noticed that we have doubled the budget for the security by two in three years. Finally, on the organization side, we also established Business Technology Office to provide cross-functional string of IT teams. We leveraged our development team based in Bucharest to speed up our delivery. The implementation of agile methodology within the IT organization improved collaboration and efficiency across businesses and support functions. So as I said, referring to Xavier's slides, the 2027 ambition, best-in-class global credit ecosystem, I was happy to see that rich data and technology excellence was the first point. Then invest in technology for full connectivity is self-explaining.
So for the next strategic plan, we are pursuing an investment in technology, as I mentioned, EUR 80 million over the next four years. First, by improving our value proposition on connectivity with our customers' APIs and upgrading all of our technologies, which are client-facing. Second, we are going to continue the supporting of our operational efficiency by accelerating the deployment of group tools. We are facilitating data supplies and usage by continuing our ramp-up in data management with the data lake, extending a comprehensive customer view across different business lines, and centralize external data from information providers through a single storage layer and promote internal data use. And also by continuing to invest in reliability and security by remaining up to the standards and more in terms of security and anticipate the obsolescence of our systems. So we need to anticipate the needs of our clients.
We believe that client and broker connectivity is a fundamental trend by the quest of digitalization of processes, seamless client journeys, and better performance. There is a growing need to be able to manage everything in one place without having to switch from one universe to the other one. Here comes the interest of APIs that allow you to connect systems with each other and therefore consume several services while remaining in one ecosystem. In the world of credit, we see two important points. First, the market for invoice-to-cash. These solutions are developing. On the left, these softwares are plugged to ERPs, Enterprise Resource Planning Systems, such as accounting systems, to extract invoicing data in a much simpler and more efficient way.
Some have developed modules for managing an insurance policy, which allows you to retrieve the insurance information and carry out simple operations directly in the application without having to connect to the insurance portals. Our customer base using our APIs is growing too. On the right-hand side, it's expected to reach 30% in terms of estimated annual values by 2027. The customers who use our Coface APIs do either it from their ERP or from their CMS, their client management systems. Our connectivity strategy is based on two pillars. First of all, you heard a lot about the world of API. First, API. What is an API integration? An API integration serves as a bridge between two or more applications, allowing them to exchange data. Imagine as it's a kind of digital handshake, a way for different systems to communicate effectively.
API integration matters in terms of data synchronization, improved productivity, and revenue boost. API is the minimum. We must develop more. It's a question of being up to market standards in terms of catalog, technical infrastructure, or technical and commercial skills. We need to extend our API catalog to connect to different systems, SAP, Sage, Oracle, and different CMSs, credit management systems such as Esker or Sidetrade. By enriching our API offer, Coface services will be integrated to customer systems seamlessly. Secondly, interface with market softwares to streamline and automate various aspects of credit management, such as credit decisions, risk management, debtor management, tracking payment schedules, cash flow improvements, and source monitoring. To summarize at the end, so three key messages and takeaways. First of all, the Build to Lead plan transformed our IT landscape, driving efficiency, security, and innovation.
The new strategy plan is focusing on technology, connectivity, and efficient data management. So the third one, our connectivity strategy combines API and market software connectivity, creating a powerful differentiator in credit management, helping to power the core.
Good morning. Now, a few words about human resources and CSR. The success of Fit to Win and Build to Lead was highly dependent on people. Back in 2016, we quickly identified the need to improve two main areas in Coface. First one was to reinforce the attractiveness of the company. Second one was to upskill management throughout Coface. In order to reinforce attractiveness, we started working on flexibility. Flexibility in our work organization. After COVID, we didn't try, conversely to many other companies. We never tried to bring people back to the office on full scale. Today, our employees enjoy three or four days a week work from home in every country. Second, we built on our international footprint to leverage mobility, mobility from the center to the regions, from the regions to the center, but also now throughout the company, from region to region.
This allowed the mobility to double since 2018. Flexibility with what we call our virtual assignments, meaning that we allow people living in a country to work for a Coface entity in another country. This is a win-win solution. For the employee, it avoids all the complexities of an international move. For Coface, it is a way to considerably broaden our talent pool. Second, in order to, after flexibility, we've been working on ways to make Coface a welcoming workplace for all. Xavier mentioned 75 nationalities in the group, many languages, a large array of culture, of religion. Also, a difference in ages. We have many ages throughout the company.
We have a mix of people who've been with us for a long time and a large number of young employees who have joined over the last years, and particularly in the world of business information services, with the number of recruitments that we mentioned, several hundreds over the last two or three years. So we've been working on diversity, on all the diversities with conferences, trainings. And here, I chose to concentrate on one particular diversity, gender, because Coface has always been a company, a very female company, if I may use that way we speak. We globally have 54% of women in the company. We have a global 39% of managers, and today, 36% of women in the top managers, in the 200 top managers, with the target to increase this 36% to 40% by 2030.
Also, you can see on the slide at the bottom of the left column, we have 46% women in the succession plans for these 200 top roles. The results of all this is that the engagement surveys we carry on on a regular basis, several times a year, show a very nice improvement in the engagement of our employees. Our global engagement score is now at benchmark, which was not the case. We have been a little under benchmark over the first years. The latest ENPS that came out of our last round shows that we are now at +36, which is way above benchmark. It's worth mentioning that we come from a +6 only two and a half years ago. That's a huge leap, which I hope shows that we are on the right path.
I mentioned attractiveness, but also the need to increase our management skills. Coface has always had a reputation of being a company of experts. The expertise has always been given a large place, but we neglected for years management. The managers were just experts who had grown and became tasked with management skills, but without having received any real training in that respect. We launched a huge management plan, Lead Together, that has already been attended by over 500 managers in the company, is still going on, and is extended to more managers, and including, of course, our new colleagues in the field of business information. The result of this is that our internal pipeline has improved quite considerably, and that in 2023, 42% of senior manager roles were filled internally, and 42% of our positions were filled according to plan.
All this was possible thanks to a modernized HR function, too. The HR management roles were upskilled accordingly. We now have a modern SAP HR tool that will allow us and already allows us to be more efficient and more agile. And we have set up a fairly unique digitized training platform that anyone can consult at any time, of course, on onboarding, but anytime in the company, on underwriting with over 120 modules that were all designed internally, thanks to our colleagues, but also for commercial skills. And we're trying now, and we have started developing support trainings, too, for support roles. So what are we going to do in the coming years? I think we will rely on what we have built already, and I have just told you about, in order to build the future plan.
We need to face, not specifically Coface, but as many companies, we need to face a big challenge, which is a scarcity of resources and new behaviors in the younger generations of employees who are keen on changing employers on a much more regular basis than was the case in the past. So we are not without assets. We can build on a strong employer brand. We can offer attractive career opportunities, as I mentioned before, based on our international footprint. We now can offer nicer diversification and a possibility for people who join Coface in the TCI business to go to BI business and come back from business information to credit insurance. We have acquired a reputation of a compliant and welcoming workplace that is also an asset. But once we have attracted people, we need to keep them.
This is why we will also have to work on nurturing and helping our talent pool, offering them attractive career paths, and also offering them a way to enhance their skills, both from an expertise and a management perspective, because this is what they expect from their employer. Last, we need to work, and we will work more on compensation. We will take advantage of our new tool that will help us to be more granular in the assessment we do of the pay levels of the different jobs. And also, we will develop it. It will help us to be more proactive and anticipate certain situations rather than follow. Now a few words of CSR. Coface has structured its CSR strategy along three pillars. The first pillar is what we do as an insurer. Second, what we do as an employer.
And third, what we do as a responsible enterprise. What we do as an insurer, we have assets and we have liabilities. Our assets, of course, are our investment portfolio. We've been decreasing the emissions of our investment portfolio for many years now. And at the beginning of 2024, we decided to join the UN-convened NZAOA, Net Zero Asset Owner Alliance, that has 80 members. And we decided to put our footsteps and their footsteps. It would be much easier; it's a fairly complex task, this reduction of the emissions. So we will follow up. And we will see on the next slide that we now have a quantitative target to meet. We also have liabilities, and we need to work on that. We have always had an exclusion restriction policy, which helps us to remain compliant in the policies and the exposure we take.
Our exclusion policy covers purely ethical matters. We completely exclude landmines, cluster ammunitions that anyway are forbidden, are legally forbidden. But we also never cover endangered species, gambling, drugs, and those sorts of areas. The second exclusion that is still growing is the exclusion around green sectors, which is less easy than assets, because assets, you can choose to sell an asset and invest in another, but it's a fairly tough choice to exclude clients. So this completely has to be done gradually, as is recommended by the regulator. Anyway. We have launched in the category of our single risk, meaning the cover of big projects as opposed to whole turnover. We launched an initiative to double our exposure on ESG-labeled projects for 2025 versus 2020. In the first place, this double target brought us to a EUR 400 million exposure.
As we have already beat the target, so we have upgraded the target to EUR 500 million in 2025. We have the second column about what we do as a responsible employer. I think I will not come back too long on this one, because we already tackled it before. I think everything has been said here. Let's move on to the third column, which is what we do as a responsible enterprise. This is we performed a full carbon footprint last year, and on the basis of the result of the carbon footprint, we built a trajectory to net zero. The trajectory, sorry, is based on our assets and our liabilities that I already described, but also on our own operations.
And here in our own operations, it means having greener premises, being a little colder in winter, a little warmer in summer, and also restraining travels and moving towards what will have to be one day a 100% electrical car fleet, which I must say is the most difficult task to perform, because people don't mind being too hot in summer and too cold in winter, but they really mind changing their cars. So this will be, this is, a bit more difficult. All this is embedded in our culture that Xavier already mentioned before. We have spread out a culture of ethics with a zero tolerance in the company for any behavior which is not ethical and not compliant, whether with a client, a broker, or among colleagues. We have strengthened the awareness of CSR through the company with many trainings and many communications.
We support group grassroots employees who have taken a number of initiatives, mainly in Latin America and mainly in the area of DE&I. So this allowed us to be awarded quite satisfactory ratings by the various rating agencies. You can see here that MSCI has given us a AAA, a AAA rating. It used to be AA, but it has been upgraded. We have an 18, low risk with Sustainalytics, a prime status with ISS, and a robust rating with Moody's. Mainly, the reason for these good marks are the fact that though we are not a major contributor to emissions, we are assessed having taken the matter seriously. We have our inclusion initiatives highly appreciated. We have a very solid compliance program, which is assessed very positively by all the rating agencies.
Naturally, as an insurance company with this international footprint, we need to be very efficient in terms of sanctions. We have a very solid program for anti-money laundering. We have incorporated in our code of conduct the latest provisions of European law in matter of whistleblowing or anti-bribery. Last but not least, we have a strong governance. We abide with the highest standards of governance of the AFEP-MEDEF code in France. We have, in terms of CSR, we have created a specialized committee that is chaired by Xavier and meets on a quarterly basis. We have a network of D&I champions and a specific network of CSR champions.
So we'll not stay too much on this one, but this one is just to show you that we're just about to hit what I'd call a regulatory wall, with a great number of regulations coming into force in the next years. The first and the most difficult one probably is the CSRD directive, with a very huge and complex reporting requirement that will take a long time to meet in a lot of work to meet in all companies in 2024, in order to be ready for the 1st of January 2025. But it won't take too much time and prevent us from going on and still deploying our strategy. So here on the chart, you see the three columns we already spoke about a few minutes ago.
But the difference here is you see that in each column, we have this quantitative target to meet for the first time in terms of emissions. We are, of course, set on the NZAOA trajectory, which will bring a reduction of the emissions of our portfolio of 30% in 2025 versus 2020. And the -30% will have to be -40% in 2030. So we are just continuing our exclusion and switching our investments accordingly. We will continue and we will extend our commercial exclusions policy. And on top of that, we will try we have decided to launch a sort of engagement campaign with the most polluting of our clients, a little on the model of what's done now with what investors do with the companies in which they invest. So we'll go and engage the main polluters in our business.
In terms of responsible employers here, we will continue on what we are doing now that's already given good results and hope it's even better in the future. We have this target of 40% women in the top 200 managers by 2030. As a responsible enterprise, we will, of course, pursue the deployment of our emission reduction plan. We will with another here, we have set another target for ourselves, which is -11% in 2025 versus 2019, 2019 being the benchmark, because it was the last normal in brackets year before COVID, so it's a good benchmark. -11% for our operations, which, in fact, taking into account the development of the business, is really a -28%. Then we'll have to improve the collection and building of our data to be able to comply with our reporting obligations in the coming years.
All this with the same culture, and this time spreading even more the awareness throughout the company and strengthening our external communication. It seems that the external communication of everything we have done and will continue to do needs to be better communicated to the market globally and to the rating agencies. Thank you.
Thanks, Carole. So it seems that some of you have been waiting for this. Let's go. First, let's have a look at the outcomes of our Build to Lead financial targets. It's not that I'm particularly keen on looking backward, but it helps to look forward. Net combined ratio, so we move from IFRS 4 to IFRS 17. It doesn't change the fact that we have over-delivered and we stayed below our 80% net combined ratio target. So, Solvency ratio, the target was to stay within our 155%-175% comfort zone.
Year after year, we stayed above the upper range of it. Payout ratio above 80%, 80% is already one of the highest payout ratios of the financial sector. And return on average tangible equity, with the exceptional year of 2020 through the cycle, again, we have delivered our above 9.5% of return on average tangible equity. Once again, we have delivered and we have over-delivered what we have promised. This is quite an achievement. Let's reflect a bit on how we got there. I will start with the economic performance, and I will start with the net cost ratio. It moved down from 30.8% to 26.6% between 2019 and 2023. When I look at this chart, what I'm seeing first is that we stayed very focused on our cost discipline and on our productivity gains.
Indeed, if you look at the overhead expenses, it has grown well, they have grown twice lower than the insurance and the non-insurance turnover growth. That's exactly how we want to drive our business. It gave us space to invest, and you heard about the fundamental technology investment we made during Build to Lead from an IT perspective, but also the investment that we made to gain our customers, the investment that we made in information business.
This is exactly, again, how we want to drive it. Another component of this cost decrease is the reinsurance commissions we receive, but we'll talk about that on the next page. So in a nutshell, cost reduction by four points, this has, for me, a very good merit to give us some room for maneuver going forward. Reinsurance. We have a long-lasting relationship with our reinsurers. We have a diversified panel of 26 reinsurers.
We are making sure that they are highly rated. I think their average rating is A-plus. Our reinsurers have a deep and full access, or deep insight, and a full access to our underwriting data. They know us inside out. This makes the annual renewal negotiation process very honest and transparent. They obviously recognize the excellence of our underwriting rigor, because over the past couple of years, we have been able to negotiate a stable two-year quota share. We have lowered the attachment point of our stop-loss treaty. This is quite unusual, and of course, this provided some capital relief. And last but not least, during I think while the reinsurance market was hardening since 2021, we have been able to increase our reinsurance commissions rate.
So if you look at the chart on the right-hand side, the blue bars, or all the bars, are actually all the commissions we see from our reinsurers. I would disregard the bars that are in green because these are reinsurance commissions we see from the governments out of the public schemes. So let's focus on the dark blue bar only, which are the reinsurance commissions we see from our third-party reinsurers. They have almost doubled since 2016. Of course, part of that is coming from the fact that our business has grown, but part of that is coming also from the fact that our reinsurance commissions rate has increased, especially since 2021. And you can see that on the I think the blue line, which are the commissions rate we see from our reinsurers, external reinsurers, with this increase over the past three years.
This is a great recognition from our reinsurers of our underwriting expertise. This is how reinsurance commissions have contributed to the decrease of our cost ratio. Another operating performance is our recurring investment income out of our nearly EUR 3 billion assets under management. We are managing our investment portfolio within three constraints: capital consumptions, and this is measured through the market resiliency capital requirement. Liquidity, we are a very short-term business, so we need to keep some level of liquidity to face claims, for instance, claims payment. And of course, investment returns. On the left-hand side, you've seen the numbers. I think a couple of things here. Since 2021, we have increased our investment in bonds and in particular in govs, which is a very capital-light asset.
We have decreased our asset allocation in equity and real estate funds, and we have kept a fairly high level of cash and liquid assets. As a result, look at the market risk SCR. So we have reduced our capital consumption related to our investment portfolio by more than 20%. We have limited, of course, our liquidity issue. What we've done also is to reduce the duration of our assets. I think it's less than three years now. And we have taken full benefit of the new interest rate environment. On the right-hand side, you see the bars in blue are the recurring investment income that has been recorded, and it has almost doubled since 2020, especially if you look at the accounting yield. Since 2021, you can see it has almost doubled as well.
So while we have seen decreased net cost ratio, better reinsurance commissions, higher recurring investment income, we are definitely in a better shape going forward from an economic standpoint. We are an insurance company, so let's look at the strengths of our balance sheet. Over the past four years, four major crises: COVID, Russian war, interest rates that increased by more than 200 basis points within one year, inflation at its peak. In the solvency framework, these are major shocks. COVID might be seen as a 1-in-100 event. The three other crises might qualify as between 1-in-10 and 1-in-30 events. These are severe shocks in a solvency framework. And yet, look at the green line. These are our actual solvency ratio. It never went down or below the upper range of our comfort zone. This is quite a resilient balance sheet. So again, how did we get there?
Of course, we discussed about the better economic performance. We have also discussed about some management actions taken. We have de-risked our investment portfolio. We have a better reinsurance structure. We have also refinanced last year, successfully refinanced our 10-year Tier 2 debt. There's another component I really want to share with you as well. This is the quality of our underwriting portfolio. And we talked about I think Cyrille talked about risk monitoring. Let's go through this. On the left-hand side, these are the levels of exposure over the past couple of years. And you can see that over the past three years, it has significantly increased. In our internal model, higher exposure means higher capital consumption. But what we're also looking at is the quality of this exposure. And if we move to the right-hand side so Cyrille is probably mastering this very well.
We set a risk appetite on the part of the exposure with the lowest quality. So this is the 0-4 DRA that we discussed earlier about. Of course, low quality of portfolio, higher probability of default, higher capital consumption. And what Cyrille is doing and you heard about monitoring was a keyword also during his presentation. And it really illustrated what he has been doing for a couple of years now. It's first to keep the real level, which is the green line, below the risk appetite. This is the first thing. And it has also decreased this level over time. This illustrates another management action taken and that has contributed to the resilience of our balance sheet.
While in the same time, you can see that our business was growing, and it allows the business to grow in a very, I would say, safe manner from a balance sheet point of view. So it's good. Solvency II is a looking-forward mechanism. So at the end of 2023, and well, it was disclosed last week, our Solvency II ratio was at 199%. Some of you are already familiar with this page because we show it also at the year-end announcement. This is the stress test that we apply to this ratio. So on the left-hand side, we have applied the financial market shocks with interest rate increase, spread increase, equity market drop. Solvency II being very resilient stayed above 193%. On the right-hand side is the economic shocks, 1-in-20 event and 1-in-50 event.
He used to say that the 1-in-50 events is related to the financial crisis, the 2008 financial crisis situation. Here again, we have a severity above the upper range of our comfort zone. What I want to share with you today is what might be the impact on our P&L in this 1-in-50 event. So if we take the reference year, of course, the latest one, the full year 2023, and we apply a 1-in-50 shock, you can see that it will eat through all the net results and even more. Our model, our reserving model, sorry, also allows for margin that is set to absorb this type of shock. So we will use part of this margin in lowering the reserve quantile at 75% and releasing some reserve. So in a 1-in-50 shock with a current year loss ratio at 110%, Coface will still be profitable.
I will end my presentation with the cash situation. So you know that we are paying our dividend to our shareholders out of the center, out of Coface SA, the holding company. The chart here and the blue bars, the dark blue bars, are showing all the cash inflows from our operating entities and our internal reinsurance entity, Coface Re. And year after year, you can see that it exceeded the dividends paid out of the center to our shareholders, so no cash issue from our end. What have you seen this morning, all this morning, that we have better economics, we had a strong balance sheet, we had no cash trapped, we have a unique culture, a great team, our underwriting expertise and rigor is well recognized, we maintain and we will maintain our focus on cost discipline, productivity journey.
This will allow us to invest further for the future in data, techno, connectivity, in serving our customers, in growing our business, and in developing our super exciting information business venture. I have a smile because I'm very confident with this, that Coface is very well positioned for the Power the Core plan and the new set of financial targets. So through the cycle for our core business, resilient core business, an undiscounted Combined Ratio at 78% and below, a solvency ratio towards the upper range of our comfort zone, a payout ratio above 80%, again, one of the highest of the financial sector, and a double-digit return on average tangible equity.
And in addition to this, we'll continue to invest and to develop this information business franchise, just to remind you that there's no capital consumption and that will contribute to our return on average tangible equity up to 50 bps at the end of the planned period. Xavier, the floor is back to you. Thank you.
Thank you. Well, I thank you for staying with us through this morning's presentation. We're kind of at the end of this. I hope it's clear. I hope it's informative. We're really happy to go through a Q&A session with all of you for I think we have about a half-hour planned for this. I'd just like to thank all the presenters for your combined efforts. Very happy to have, as I said, our management team here. I want to recognize also the presence of our chairman, Bernardo Sánchez Incera, who's been with us through this journey now for some time. We're all very excited about going forward with this plan. Please shoot, and let's have a dialogue. Michael's always in the front row. Or Hadley, I don't know. You guys fight it out.
Three questions. One is on slide 91. So you said.
Do we have 91 slides?
That's the one that you talked about last, the 1-in-20 shock. So you said the risk something would come down to 75%. What is that exactly? And how much more buffer?
Oh, yeah. It's the quantile. You know that the way that we reserve, you have the quantile in a range. So the margin quantile will go down to 75, which is the, I think, this is the norm of the sector. Today, we are high at quantile, which is allowing for more reserving. I would put it this way. So we're probably coming down when you have a shock to use this margin, which will be set at a lower quantile above and on top of our best estimate reserving.
Just to understand, so does it mean that you have 75% or you would still have 75% more than you would still need?
It's a confidence.
The other question is on business information. So I was trying to, do you have a number for how much it benefits the core business? And the simplest number I could think of is the cost ratio because presumably, you're using some of the same stuff twice over. So there's a benefit in cost here, maybe?
I would say it does not benefit the cost ratio. We've actually been investing. I think if I refer to the quarterly presentations we go through, we've several times in a row highlighted how much the cost ratio has actually been impacted in a negative way by our investments in business information, right? And we've highlighted so you can go back into, so it's more, I think, what Cyrille talked about, which is the knowledge, the level of overall investment we're able to make in data, technology, and knowledge, and how that actually provides insights and further enhancement of our underwriting capabilities.
My last question is very cheeky. Did you think about putting a progressive on your dividend?
Good try.
We never think of those things, Michael. We're brain dead.
Thanks very much. At the risk of sounding like a broken record, can I ask about the capital position?
Mm-hmm.
I mean, you don't have any refinancing needs for several years now, so it feels like you're growing into your capital position. And it seems like there's a lot of organic growth opportunities, but I think you've mentioned M&A more recently than I've heard you talk about. So can you just talk a bit about the opportunities that you're seeing there? Is it just on the TCI side of things? Is there other stuff? And if I think about the fact that you're still targeting 155-175 and want to be in the upper end of that, then at the moment, you have around EUR 300 million euros of excess capital, which should grow organically. If I think about your returns on capital, that should provide at least an extra EUR 30 million of earnings.
You're talking about another EUR 10 million of earnings from the BI contribution by 2027, so an extra EUR 40 million of earnings effectively over the next few years. Am I thinking about that in the right way? Presumably, if you don't find the ability to earn that extra earnings, you'll return that capital to shareholders. My second question sorry, there's quite a few questions there, but my second area of.
Maybe we can take them one after the other so that we don't forget them because well, I mean, at the risk of sounding like a broken record in turn because we've had this dialogue for years now, right? So I said the solvency margin, 155-175, that's a regulatory discussion with our regulators. Where we stand, we've always said we wanted to aim towards the upper end of that range for safety, comfort. We have leveraged more the balance sheet, as you know, over the course of the last couple of years. And so the nature of that overage is a little slightly different than it was before. But I've always said this, and I will say it again. We have three priorities, right? Number one, finance our growth, our core growth. I mean, nobody thought we would grow 16% in 2021, quite frankly, or 2022.
It was a 2022. These are numbers that no one in this industry would have thought about, but inflation got us there. Number two, we want to have the flexibility to do smart M&A, whatever that means. So we've done a few, and I'll repeat this. We do M&A that brings either skills or scale, skills that we don't have, which we're much better off acquiring rather than trying to build ourselves because we wouldn't have the time or the skills, or it would just be too much of a slug. And scale in certain areas where immediately, we can gain efficiency. We did a deal in Slovenia, one in the Nordics. It just gives us local scale, and it fits right into our acquisition, to our business. So we're open to doing more of this. I mean, we've always been looking.
We don't want to do it at any price, at any cost, for any reason, consistent with our positioning, which is we want to create value over the longer term for shareholders, right? So we're thoughtful about it, but we're open to doing it. And as you've seen, we've done a small, it's quite a small deal last year in the tech space for the same reason. It added a unique capability of identifying companies because when a client comes and says, "I've got a portfolio of 10,000 companies, and I'd like you guys to tell me what it's worth," the first problem is, who are those 10,000 companies?
In our traditional method, we would have probably identified 25% of them automatically, and then 75% of them, we would have to slug through one by one, and we'd send that to India, and we'd have a bunch of people just trying to figure out, who is this? Because no file is perfect and matches perfectly our own definition. With this acquisition, we went from 25% to more than 70%, 75%, 80% automated identification, huge time saving, huge revenue enhancer for us, and huge service perception from our clients, right? So we're looking for things that change our game, and there might be more out there. So we're constantly looking, and we're looking both in TCI and now, of course, in the business information space.
Lastly, of course, we're not going to keep excess capital forever and under any condition, but I think at an 11% kind of yield, we're the best in the market, all categories included. I don't think that adding another 0.5% or whatever is going to make a big difference. We have been returning capital consistently to our shareholders. We were the first ones out of COVID to be allowed by the French regulator actually to reinstate returns to shareholders in the form of a buyback at that time. I think we're very disciplined in the way we manage capital.
Great. Thank you. Second question is sort of a follow-on to Michael's question about slide 91 because I think that's a very powerful slide showing the 1-in-50-year scenario and that you still make money in that scenario. Just a clarification, though, is that before management actions, or should we think that as in your loss pick is 110%, is that before you've sort of anticipated any actions, or should we assume that actually, the net effect is negligible anyway because you'll have a lower shock on reserves, but then you'll have a lower offset from the release of the confidence level? So the net effect is still unchanged?
It's an instant shock, as I said. So that's the caveat. It's an instant shock before any management actions. It's when it happened. And of course, the second caveat is based on the full-year 2023 results. So it's also one of the caveats that I want to put on this page. But it really illustrates where we are and how we will be able, even with this instant shock on 150, which is quite severe, 110 current year losses, to absorb part of that.
In theory, then, the picture could potentially actually be better than this?
Well, if this guy is doing great as he used to.
And then we run.
With a caveat, as you know, that this is simulation and.
No pressure.
You never know what a legacy crisis can look like.
Sure. Then my final question is for Cyrille. It was a comment that you made, Xavier, earlier around the standardization of the clauses because you do so many different things in so many different countries and what have you. I was just wondering, to what extent, if you standardize clauses, is there a risk that you are potentially being overaggressive or maybe even the other end of the spectrum in terms of given certain jurisdictions and what have you if you're standardizing across the board? And then linked to that, we know that pricing is negative at the moment, but can you talk a bit about what you're doing on the terms and conditions side of things and to what extent you're able to offload some of the risk transfer from your own business to your customers?
I think over-standardization of the contract and the clauses leads us for more or less aggressiveness. That's the point, then. What we want to do is to propose a kind of standard contract, and we have to take all the legacies from the past, all the kind of very specific clauses we accept to provide in the past. So the point we end with, Nicolas, that the main challenge we face today is how to negotiate with the customers in order for him to accept something which seems less interesting because he's not used to what we are proposing. So in terms of aggressiveness, the standardization is not at all something dangerous in terms of it's nothing to standardization.
The point about aggressivity is much more coming from the market, not linked to the clause itself, but much more linked to, okay, the pure aggressivity from competition, saying, "Okay, guys, what was at 1 today is minus 20%, 30%." But what we are trying to do is really to be much more efficient in the way we are going to manage the contract in the old tools on the commercial side and on the underwriting, and especially on the claim side. The more the contract is standardized, the easier it is to manage it also on the claim side. So we have some productivity gains with standardization. So we can give maybe back a little bit to the customers. But we have some smart solutions. For example, we are proposing to have the standard clause. We are proposing a grandfather clause.
Okay, guys, you think that it is not as good as what you used to have, but okay, we commit ourselves to make the best assessment between the two contracts.
And then I'm sorry, on the terms and conditions, in terms of have you been able to transfer any risk to your customers in terms of high deductibles or anything like that?
Yes, Nicolas. Yes. Yeah. Negotiations.
This is all I mean, this whole clause thing, coming into Coface years ago, you realize that you have terms and conditions you agree with a multinational, and then you have teams trying to decipher that in 70 different languages in 200 different jurisdictions. So you take teams of lawyers, you put them face to each other, and they're all going to try to be smarter and to bill more fees, right? So it's going to get complex very quickly. So what we're trying to do is to take that complexity out of that system to bring it back to the center where we can understand from the center in a simple way as much as we can translate a clause in one language in one judicial system into another language in another judicial system.
We're trying to make that equivalent so that it's a lot easier, a lot faster, cuts through the negotiation, and basically provides similar, if not exactly identical, similar terms and conditions to our clients. Part of this is effective execution. Part of this is just preferences that people used to have because they like to have this word in front of this word or whatever and market practices. So that's why it takes so much time. You have a lot of convincing to do, not just with the clients, but also with the brokers and everybody that's involved with this process. Please.
Thank you very much. I'm William Hawkins from KBW. Forgive me. I don't know your company as well as my two predecessors, but I'm interested to learn a bit more about your comment about the churn ratio right at the beginning, what's been happening, and how you expect that to develop in the future. Again, I'm not quite sure mathematically, is it based on premiums or number of clients? And churn could be because you've got your big old core clients where there's been a massive improvement, or you did have a group of very flighty clients that you've either improved the relationship with or cut off, or it may be a function of growth. And again, particularly if it's based on premiums, it could be a function of growth.
So help me understand how that ratio has gone up, and do you have a view of what the optimal figure is, or is it just nice that it's gone up? Then secondly, please, that slide 85 where you've got that space to invest, the jaws that have been -11 and +5. I'm not quite clear how you're thinking about that in the future, what the two components of those jaws are going to be within the 78% combined ratio. Thank you.
Well, maybe we'll start with that last one. It also depends on the environment. We are thoughtful about how we run the business. I mean, my whole effort in the last eight years, our focus, our obsession, I would say, has been to try to take money out of things that don't matter and to put it to work in things that matter more. If we can save a dime on something that's repetitive and that can be automated, that can be done by a machine or whatever, we will do that. That frees up resource, and that resource, we deliberately invest in things that we think are preparing for the future or differentiating Coface further, increasing our knowledge base, driving technology, etc., etc. That's really all that we've been doing in the last few years.
How that ratio evolves is also a function of the environment in the sense that when you have 15% inflation, we immediately get, literally a few months later, 15% growth, right? Because we bill our clients a percentage of their turnover. And that gives us an immediate jump in productivity, which then catches up with us, I would say, months later when we have to increase the wages and everything of everybody else, and then the inflation starts to go down. So I can't tell you exactly how this is going to work out, but I think through those cycles, we've been able to demonstrate that we continue to make productivity gains in a very disciplined way, and we continue to reinvest money into the areas that matter and are critical to the plan. When we see an opportunity, I like to have the flexibility to take action.
If it makes sense for us in the medium term to invest in business information in one country, I'm going to do it even if the cost ratio is a little less favorable in the short term because it doesn't really matter, to be honest, if you take a three- or four-year perspective. So that's question number two. Question number one was, oh, the churn rate. Okay. Yeah. So we measure our ratio measures how many clients we keep after a year versus how many were there before, right? That's the premiums, right? That's the premiums. So when I joined, we were at, I think, 88%, 87%, 88% was kind of the accepted retention level from one year to another. Typically, it's rare that premiums go up with one individual client, right? They tend to go down every year because we make productivity gains.
Anyways, we were at 88%, 87%. And that's quite inefficient because it means you have to bring in 12% new clients every year just to stay flat, right? So I started looking into, why are we losing these clients? What's going on? Would it be possible to retain more of them? That's a lot cheaper to retain a client than to acquire a new one. It's also a lot less risky because you've been working with them for years. You've gone through all the set of costs. You have a better knowledge of their own clients and their industry and how they work, etc., etc. So there's all the reasons in the world to try to retain a client rather than trying to gain a new one to make up for it.
And so we started looking, doing a lot more client surveys, trying to understand what were the drivers. And some were pretty obvious, like you don't cut 50% of my limits in two weeks without giving me a phone call. I mean, others were a lot more subtle. And then we developed tools using AI because not everything we could understand ourselves. So we developed a scoring tool that looks into customer data and gives us a score, an attrition score, and says, "We think this client has a propensity to leave us, which is higher than others." And then we go when that happens, we give that name out to the sales teams, and they go in, they go talk to the clients, figure out what's going on. "We haven't heard from you for three months. What's going on? Are you preparing something?
Is there something you're not happy with?" Etc., etc. Then we go in and we work it from the inside. So I think that's really the attrition. In terms of segments, typically, whatever is far away and distributed and automated tends to thrive more than what's high touch and high contact. So very large companies tend to stick with us for decades. Small clients, we don't just have the same level of time, face time, and energy to spend on them, and they're also more sensitive to shocks. Actually, out of that, just wanted another comment. Out of that 12%, part of them are companies that just go out of business. They're not there anymore, or they're bought by somebody else that has a contract with somebody else or doesn't want to get insurance or whatever. They're merged into a new situation.
All of that is included in our attrition rate, right?
Hello, Amine. Yes, thank you for the detailed strategic plan. A few questions on my side. Maybe the first one is regarding factoring. You did not mention this business, so what are your ambitions in the two markets in which you operate? And if you can elaborate a little bit more, sorry, regarding the value added for you to own this business, I think that in terms of risk management, maybe it adds you some value. And in terms of expected return on profitability, ROT, of this business versus 11% target.
Yeah, that's a good point. They were, as you know, it's not just, by the way, factoring, but also bonding or surety and single risk. Our businesses that we have in a select number of countries where we have enough scale and industrial presence that we can do it effectively and do it well. That's the case in Italy here where we are still. We have all of that in Italy, not factoring. So we have in Build to Lead, we had one of our targets, which was to improve and become really good at factoring. I think we did this. We have one of the best teams, I think, in this industry in Germany and in Poland. We have been growing. We have been improving our returns. I think the returns in that industry are pretty consistent with the returns we get in trade credit insurance.
To me, they're another face of the same coin because factoring is the same thing as credit insurance, except you provide the liquidity upfront, right? The cash flow is inverted, but the risk management process is pretty much the same. For us in Germany, having factoring, having trade credit insurance, having information is all about credit risk management and having different flavors or different ways to provide that to companies. It gives us a distinctive advantage, I think, over our competition that doesn't have this business. It increases our access to data, increases our connectivity and our connection to clients. It fits right in. But you can only do it if you have a good enough infrastructure, if you are set up right, if you have an industrial-sized capability.
We only have that in two countries, so we're not planning on doing a whole lot more in this space in terms of new countries. That's why we haven't really mentioned it.
Okay. Thank you. Maybe a few questions regarding BI. I mean, this has been developed for many years now. Do you have some figures regarding client retention rate, net promoter score, and what you consider regarding pricing on this business? Maybe do you fear potential competition coming from new players such as fintechs using AI, or do you think that it should not happen?
Yeah. So I mean, we're launching this business in multiple places. So when you launch a new business, you start to first thing is, is there a market appetite? Is anybody going to buy this product from me? And that was the first test we did. And the response was yes. I mean, you've seen from Thibault's slide that already about a third of our total client base globally is with BI. I mean, that's significant. I mean, they're not big contracts, but it really creates another level of relationship with potential clients for Coface as a total entity. So that's the first step. Then we have to build sales capabilities. We have to build products. We have to build infrastructure, technology, and systems. And then we start to look into client relationships.
So we're not at a level of maturity where I can already start tracking ten years of retention and this and this and that. We're learning as we speak. It is really a series of startups that we're driving from the center just like you would a startup in any other area. So think of Coface as an old company managing the insurance side extremely precisely and neurotically almost, and on the other side, being incredibly fast and innovative with a startup that uses kind of the same tools, right? So we have a lot more to learn, I think, on retention, on pricing, on NPS score, on differentiation. But I think we're still very small in this market, right? So more to learn, more to come.
Okay. And maybe last question is regarding the financial target. You did not disclose, I will say, your gross expectation, revenue gross expectation, but I'm sure you have some view, of course, about this. And does it compare versus GDP growth? Because in mature markets, I will assume that revenue should grow broadly in line with GDP growth, except that you have some pricing pressure. But on the other hand, as mentioned, you have some room to grow on mid-market, mid-cap market, maybe also in the U.S., and so on. So do you believe that you'll be able to outperform GDP growth by, I don't know, 1, 2, 3 percentage points? I mean, any view on that?
I mean, historically, this industry has grown about twice the rhythm of GDP until about 10-15 years ago, right? Then it went down to 1x GDP, right? And as much as it is an oligopoly, it is still a very intensely competitive business, right? So we're not the only drivers in this equation. As I've shown you, prices tend to go down, and efficiencies tend to be passed on to clients on a regular basis. We have, I think, over the course of the last four years, grown pretty much like the market, maybe a little bit more, just slightly but barely. But we have maintained a very good profitability and a very good discipline in what we do. So our goal is here not to gain share for the sake of gaining share. We're not looking for top-line growth.
We're looking for consistent value creation through the cycle. When the market gets exuberant or whatever term you might want to use, we are okay not participating or participating less. When the market is more favorable, we are looking also to participate more.
Okay. Thank you. And very last quick question, which is the normalized tax rate of your plan? Thank you.
Can you hear me?
Yes.
Yeah. So well, it will not change much compared to what we have seen during the past two years. And if I want to add something about the OECD tax reform, we are not that much impacted as well.
Hi. It's Phil Ross from Exane BNP Paribas. I've got two on ROE and then one on the macro. So firstly, on the ROE, the 50 bps from BI in 2027, can you tell us or give us a hint about what the contribution is today from BI? Should we assume it's zero, one negative?
No, we always said it was positive. But this is a very small business, so it doesn't make a huge difference on the bottom line. But it is a profitable business.
Okay. Thanks. The 11-point target for the group, you mentioned that's within the current interest rate environment. I'm just curious about the sensitivity there or how much potential rate change you factored into to make sure that target is robust.
It's just simple math. We have a EUR 3 billion portfolio that yields what is it? two.something%. You do the math. I mean, your math is as good as mine.
Okay. Thank you. Then the last question, a more reflective one on the macro. You've spoken before, I think, in the press earlier about this wall of debt that the economy might see in 2025, but we haven't really talked about it today. I don't know if you are still a little bit nervous of that, or is it all the great work everyone's presenting today?
I mean, in my shoes, in my job, yes, we're nervous about everything all the time, right? I mean, that's our job. That's what we get paid for. So we haven't spent, by the way, I haven't included in this presentation a 1-hour pitch by Jean-Christophe, who's sitting right behind you, by the way, who's our Chief Economist, because I don't think that was the topic of the day. I mean, macro remains our focus, our concern, and we keep watching both countries and sectors and clients and industries and this and this and this, government intervention like oil on fire because that's the core of our business. But our intention here is to present to you an ambition, a plan that goes through the ups and downs of the global economies, which we consider our job to manage as best we can.
I think we tried to illustrate that during the presentation. Is there still problems in the world? Yes, you bet. Is there still a lot of debt out there? No question. Political risk is back, absolutely clear. Political opportunity as well, I would say, because as much as political risk has surprised us, governments have washed the economies with trillions in incentives and cash, etc., over the last five, five years to a level that nobody expected, which also explains why the, I would say, the normalization of insolvencies has been as slow as it has been. So we're wary. We're careful. I mean, we don't know. I can't tell you what's going to happen if I could be rich and probably retired. Actually, not because I love what I do, but it's very hard to predict. I think we see levels of debt that are pretty high.
I mean, in private debt, public debt, that is one of the walls and concerns we have. But I think the economy's been pretty much kicking the can down the road, and we've all been surprised and, quite frankly, not very good at predicting what's going to happen. So we focus on doing the best we can to predict but also being very vigilant in terms of managing whatever happens once. That's the honest answer.
True. Thank you. And it wasn't at all a critique of the slides, so thanks.
Michael again.
Just a couple. So you said you reduced the retention relative to reinsurance, and I just wondered if you could give us a couple of numbers there. And then the other thing is, again, on slide 91, what's the loss ratio you're assuming there? Thank you.
We have reduced the retention point of the stop-loss treaties by a certain level. It's disclosed, right? No, it's not. Okay. It's not.
Proprietary.
Good try again, Michael.
Get closer to the mic, if at all.
Oh, sorry. So yes, we have lowered this attachment point last year. Well, you know that we're managing the combined ratio as loss and cost as usual because there's clearly an interaction between the two, and we never really look at each separately to the other one. So the target is for the combined.
If I look at slide 91, what is the number?
Oh, sorry. Oh, the current year loss ratio is at 110%. I think it's on the slide, right?
Yeah, 110. It says it on the slide. It's easier. Actually, we should read our own slides.
We have a question on the web because people can ask questions. The first one is on BI. What is the target addressable market that you are chasing? And in terms of competition, you probably meet companies that are more competitive, more agile than in the traditional TCI space because you have fintechs and large companies that are successful. So what are your chances to really succeed there?
Well, I mean, the addressable market we find is I think it's large. I can't really quantify it because I think what we offer is slightly different than what the market participants offer today. So I mean, as Thibault, I think, explained, there's a lot of people providing basic reports and data on companies. We actually are a client of those companies. And what we do is we incorporate our own knowledge and expertise, and then we provide, I would say, more value-added services to the market. And that segment is kind of new, something that others are also trying to do, but there's no clear description of what the total market today is for this. I just think we are showing, literally, month after month, that there are multiple applications for what we have to offer. We find that our clients are potential market.
We find our prospects are potential markets. We can use it for credit risk, for supplier management risk, for marketing, for financial institutions who want to increase their knowledge and benchmark their own activities. So I think it is significant is what I could do is what I could say probably best. What was the other point? Fintechs. So yeah, the theory is fintechs or tech companies could come and compete with us on this, but where do they start from? They have to do the same thing we do. They have to get access to data. They have to build infrastructure. They have to get knowledge. They don't have thousands of people that have done this for decades. The wealth of accumulated data, knowledge, expertise in Coface, I think, is a huge advantage when you start because we have EUR 700 billion that we manage.
As Cyrille said, five million lines and three million requests a year. That's real stuff, right? So if you're a startup, what do you do? Where do you start from?
Just one last question. The EUR 700 billion exposure, is that the amount at risk at any one time, or how do I think about that?
It is the amount of credit authorizations that we have agreed to with our clients so they can trade up to that limit at any point in time. Now, we know statistically, clients don't use all of that exposure at any point in time. Our exposure is a fraction of this. The real amounts at play are a fraction of this. That's very much the way we run our business.
Would it be about a third?
What do we say? Typically, between a third and a half, something like this. Varies widely by industry, depending on the time of the year, etc., etc., etc. No other questions? Well, I mean, if the team can stand up, I'd love to thank everybody for their participation, Mr. Chairman. Thank you for being with us. I think we're really happy to engage on this next phase of our journey. We will take more questions on one-on-ones, investor relations meetings, and conference calls, quarterly earnings calls, and roadshows, and many other things. So thank you for being with us. We really appreciate your interest in the company. We think it's going to be another fun chapter in our journey, and we will be happy to share this experience with you going along. Thank you very much.