Business will go where the environment is the most predictable and friendly, says Ace Ltd. chairman and chief executive officer Evan Greenberg.

To continue the success of its international business sector, Bermuda needs an infrastructure that can compete with rival jurisdictions and ensure that business feels welcome and not regarded “as a source of evil”, he added.

Mr Greenberg, who seldom gives press interviews, was speaking exclusively with The Royal Gazette as Ace celebrated 25 years in business.

The company was started by 34 corporations, who were seeking a source of excess liability insurance that was difficult to find in the mid-1980s. Ace was incorporated in the Cayman Islands in 1985 and opened its first office in Bermuda the following year with six employees.

Since then it has grown to become a global giant of the industry, with operations in 53 countries,15,000 employees and more than $78 billion in assets.

The company was initially led by John Cox, then Brian Duperreault, before Mr. Greenberg took the reins in 2004.

In 2008, Ace became a Swiss company, when it moved its holding company from the Cayman Holdings to Zurich, while its Bermuda units - Ace Bermuda and Ace Tempest Re - have continued to function here as before.

Asked whether Bermuda was doing the right things to continue its success with international business, Mr Greenberg said: “When you’re an island out in the middle of the North Atlantic, it’s pretty easy to forget that you don’t just live in a world unto yourself. Bermuda should recognise that we [Ace] are competing in a global economy.

“As a company in a market economy we have to constantly remake ourselves. I wake up every day knowing that we have to be relevant or we disappear. Bermuda needs to be informed and should be informed by the same, in order to remain relevant. You need to be attractive to business and that means you’ve got to be competitive.

“And generally that involves an enlightened regulatory environment, an infrastructure that is cost-competitive and a bureaucracy that is not overly burdensome. And that it’s clear in the way it’s organised that it wants to attract and retain business, that business is not a source of evil. I’m not sure that message is always clearly understood.”

Many in the international business sector have pointed to the increasing cost of doing business on the Island as a concern. The increase in the rate of payroll tax, from 14 percent to 16 percent, announced in the last year’s national Budget, and the lifting of the payroll tax cap added to the tax burden on companies.

Is this factor material to an enterprise the size of Ace? Absolutely, it is.

“There’s a fallacy in looking at a large business and saying, ‘The individual pieces don’t matter, they’re inconsequential’,” Mr. Greenberg said. “It’s the sum of the parts that makes the whole.

“All of the parts have to be well-operating and efficient. And a company of the size and the geographic spread of Ace, has more options, more opportunities to imagine efficiency and cross-competitiveness.

“When we look at a place of function we’re going to look at flexibility and efficiency - and included in that is cost.

“I’m mindful that we are a corporate citizen. On the one hand we’re a member of the community and on the other hand we’re a guest. I don’t make the decisions for a country, I don’t make the rules.

“Governments have to decide, based on their own priorities what those rules should be. Then we, as businesses will decide whether those rules work for us, or not. Business is going to go where the environment is the friendliest and the most predictable.”

The social environment is another important aspect for companies to consider.

“A well educated, motivated, hungry, ambitious workforce is always an attraction to business,” Mr. Greenberg said. “The societies that I observe, where business thrives and economies are growing, they are those where there is a premium placed, starting in the family, on education. There is a work ethic, pride, ambition and a level of skill that is admirable. That’s a winning combination.”

Ace now holds its board meetings in Zurich instead of Hamilton, but the company remains committed to the Island. “Bermuda is an important place for Ace,” he said. “It’s not only where we were born, it has been and remains an important home to the company. We have a lot of our asset here. We have two important businesses here.”

Switzerland, he said, was a more appropriate domicile for the global company that Ace had become than the Caymans, a country that provided the predictability and certainty in which a company could thrive.

Some companies in the Bermuda market have followed Ace’s lead in relocating their holding companies in Europe, including XL Group, Allied World and Flagstone. Asked whether more were likely to follow, Mr. Greenberg said: “I don’t know what they’re each thinking - but it wouldn’t surprise me.”

While some business leaders might feel the strain from running such a huge operation as Ace, Mr Greenberg relishes it. “I am honoured, I am privileged to be able to lead this company, to be given that opportunity,” he said. “It energises me. What we are creating and building, we’re passionate about.”

Before joining Ace in 2001, Mr. Greenberg worked his father Maurice (Hank) Greenberg at American International Group, where he worked his way up to president and chief operating officer.

His decision to leave and make his mark at a younger, up-and-coming company has paid off. He guided Ace through the financial crisis with barely a hiccup and has continued to build the company, both organically and through a series of significant acquisitions this year.

He explained the conservative philosophy that has been so successful for Ace through its first quarter of a century in business.

“Firstly, we’re builders and we behave as owner-managers,” he said. “It’s our company. Secondly we have a clarity of strategy and vision. What that means is we know who we are and who we want to be. We know what it takes to get there. We’re patient in strategy and we’re impatient in execution.

“Thirdly, to execute strategy is a combination of organic growth - because we’re builders - and we complement that with acquisitions that are intended to advance our strategy.”

People who could adapt to the multiple countries in which Ace operates were also an essential ingredient of the group’s success, he added.

“We have a dedicated and very experienced management team, who are disciplined and know the business of building a global company,” he said. “It takes internationalists, those who know how to operate in many different cultures and environments around the world. Our team has that experience.”

More material from the interview, in which Mr. Greenberg gives his views on the biggest challenges facing the industry, global warming and whether Ace could ever become too big, will be revealed in the next edition of The Bottom Line magazine, distributed free with copies of The Royal Gazette in the Hamilton area on January 13, 2011.