Marsh & McLennan (MMC) CEO and President Mike Cherkasky says insurers and governments should be planning for global warming and the risks associated with it.

Mr Cherkasky was in Australia last week to talk about the revamping of the global company, the risks ahead and growth for the local operations of MMC’s broking company, Marsh.

“I think we would be silly to think that over the next decade or so that the enormous number of hydrocarbons we are putting in the atmosphere is not going to have some kind of potential impact,” he told the ABC’s Inside Business program.

Marsh Global CEO and Chairman Brian Storms accompanied Mr Cherkasky, and told Sunrise Exchange News the company – which was at the centre of New York Attorney-General Eliot Spitzer’s widespread insurance investigations – looks “remarkably different” to how it was in 2001.

Marsh globally lost about $US900 million ($1.2 billion) in over-rides as a follow-on effect of the Spitzer campaign, but Mr Storms says Marsh, like many US companies, has changed.

He wasn’t keen to disclose figures – first-quarter results are being released next month – but he did say things are looking very positive for the company.

Marsh has extensively overhauled its methods to ensure greater transparency. It has dropped commissions and adopted a fee-for-service model and is undergoing what Mr Storms calls “a recalibration”.

It will expand its interests to risk management and the private equity and acquisition market, as well as cut back on IT spending as part of the restructuring.

Marsh Risk Consulting, the business that handles the group’s risk management offerings, will increase its staff but other divisions will have staff cutbacks. This will include removing inconsistencies across the group’s IT systems, which could save the group upwards of $US100 million ($134.2 million).

Mr Storms says the company is also experiencing a new industry phenomenon, in which ex-employees are asking for their old jobs back. “We call this reserve flows, and a number of our former key staff who left Marsh for one reason or another are coming back.”

He couldn’t put an exact figure on the number of former employees heading back to the company but says it is increasing each month.

The company intends to save about $US600 million ($804 million) through the cutting of about 5000 jobs globally. The US and Europe will lose some processing jobs, but Mr Storms says he wants to dismiss rumours that the group is going around the world “cutting heads”.