Lloyd’s managing agent Atrium Underwriters has been fined a record £1.05 million ($1.87 million) over “detrimental” non-financial misconduct that includes “sanctioning and tolerating” inappropriate comments made about female employees at “Boys Night Out” sessions for many years until 2018.

In a notice of censure published last week, Lloyd’s says some male employees including two in leadership roles engaged in unprofessional and inappropriate conduct during the gatherings.

They held initiation games, took part in heavy drinking and made “inappropriate and sexualised comments about female colleagues that were both discriminatory and harassing" to their female colleagues.

Lloyd’s says some of the conduct was led, participated in and condoned, by the two senior managers in attendance.

The charge relating to misconduct at the annual outings is one of three issued against Atrium, to which the underwriter has admitted.

The other two relate to how Atrium failed to notify Lloyd’s of the facts and matters relating to an employee’s misconduct and how Atrium failed to properly follow up on complaints made against the employee in accordance with its policies at that time.

According to the notice of censure, Atrium failed to take disciplinary action against the employee even though its own investigation made findings of serious misconduct against him and recommended disciplinary action.

The employee’s general conduct was well known within Atrium, including by senior managers, but no adequate steps were taken to deal with it.

Instead Atrium negotiated a settlement package with the employee, identified as A, and allowed him to resign from rather than face disciplinary sanction.

“This was motivated in part by the desire of a senior manager to protect Atrium from bad publicity as well as the desire to limit the impact on the business unit involved,” the notice of censure said.

Atrium also instructed the junior employee who complained about A’s conduct not to speak about the outcome of the investigation or the allegations made.

The junior employee complained about A’s “systematic campaign of bullying” over many years.

“We are deeply disappointed by the behaviour highlighted by this case, and I want to be clear that discrimination, harassment and bullying have no place at Lloyd’s,” CEO John Neal said.

“The robust action we have taken today, including the largest fine ever imposed by the Lloyd’s Enforcement Board, shows that we will not tolerate poor conduct in our market.”

He says Lloyd’s expects all participants in the market to meet the highest standards of professionalism and that Lloyd’s is continuing to use its powers to intervene when needed.

“Everyone in the Lloyd’s market and Corporation should expect to work in a culture where they feel safe, valued, and respected and if they see unacceptable behaviours, to speak up with confidence, in the knowledge that action will be taken,” Mr Neal said.

As part of the enforcement action against Atrium, it will also pay Lloyd’s costs of £562,713.50 ($1 million).

Lloyd’s has in the last few years taken strong measures to address inappropriate behaviour against women employees in the marketplace after findings from a workplace survey released in 2019 revealed widespread toxic culture and practices.

It has a gender balance plan to improve women’s representation at senior levels and set standards of business conduct that must be observed by everyone working in the market.