A Lloyd’s of London syndicate has been fined £1.05m over a culture of bullying and discrimination including an annual “Boys’ Night Out” characterised by heavy drinking and sexualised comments.

Underwriting firm Atrium was also ordered to pay £563,000 in costs, after it accepted three charges of detrimental conduct brought by the insurance market’s enforcement board.

The case comes after previous concerns about sexual harassment at Lloyd’s, and it said the fine – the biggest it has issued for misconduct – showed it “will not tolerate” such behaviour.

In a “notice of censure”, Lloyd’s said the charges against Atrium reflected serious failures, including by senior managers, which “precipitated a culture which tolerated instances of unacceptable conduct involving discrimination, harassment and bullying”.

Two charges related to one member of staff, Employee A, and his “systematic campaign of bullying against a junior employee over a number of years”.

His behaviour was said to have been well known within the company, including by senior managers.

Lloyd’s said Atrium failed to take adequate steps to help the junior employee and failed to take disciplinary action against Employee A, despite an investigation finding evidence of serious misconduct – instead negotiating a settlement package and allowing him to resign.

Atrium instructed the employee who had complained about the behaviour not to talk about it – partly because it wanted to protect senior managers from bad publicity – the notice of censure said.

The company also failed to notify Lloyd’s about the misconduct, the enforcement board said.

A further charge related to the company “sanctioning and tolerating” over a number of years from 2018 an annual “Boys’ Night Out”.

This involved some male members of staff, including two senior executives in leadership roles, engaging in “unprofessional and inappropriate conduct”.

That included “initiation games, heavy drinking and making inappropriate and sexualised comments about female colleagues, which were both discriminatory and harassing to female members of staff”, Lloyd’s said.

“Some of this conduct was led, participated in and condoned, by the two senior managers in attendance,” the notice said.

Lloyd’s said that Atrium has since implemented changes to its policies relating to disciplinary matters, whistleblowing, and diversity and inclusion and was also implementing recommendations made by an independent third party.

Atrium chairman Christopher Stooke said the company fully accepted the ruling and recognised it must ensure such behaviour was never allowed to happen again.

Lloyd’s acts as a marketplace for around 100 insurance syndicates, employing around 45,000 people.

In 2019, it pledged to take action after a “distressing” report highlighting a culture of sexual harassment of women who work there.

A subsequent survey found nearly 500 had had such an experience and painted a picture of a drink-fuelled working environment where harassment was rife and complaints were not taken seriously.

Chief executive John Neal said after the fine against Atrium: “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.

“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.”