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Insurer in Full: ESG scrutiny intensifies as multiple stakeholders monitor industry progress

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Topics: ESG Regulation & Compliance Strategy Topical Trends

In recent weeks there has been a resurgence in protests against the industry’s role in providing insurance for fossil fuels, with Extinction Rebellion activists forcing the closure of the Lloyd’s building on 12 April...

This year’s RISKWORLD conference in San Francisco – formerly known as RIMS – also saw a series of protests with activists painting a 30-foot mural targeting the industry outside the opening ceremony. 

Against this backdrop, investors are also taking an increasingly tough stance in calling for improved climate disclosures and more transparency on actions being taken to help forge a clear path towards net zero. 

Berkshire Hathaway, Chubb, The Hartford and Travelers have all faced shareholder resolutions calling on them to align underwriting and investment activities with a 1.5ºC pathway ahead of their annual general meetings. To date, these major players have all called on shareholders to vote against these resolutions.

In the case of Berkshire Hathaway, the California Public Employees’ Retirement System, the largest state public pension fund in the US with $450bn of assets under management, has said it will vote in favour of a resolution calling on the conglomerate to provide shareholders with an annual assessment on how it manages physical and transitional climate-related risks and opportunities.

“In our view, the company’s existing disclosures are insufficient for investors to adequately assess the company’s physical and transitional climate-related risks and opportunities,” the pension fund said. 

These actions highlight how the industry’s ESG progress is now under scrutiny from multiple stakeholders, ranging from climate activists on the street to the largest state public pension fund in the US. 

Another group of stakeholders with a keen interest in the industry’s progress are the next wave of talent which will define the sector’s future. 

As BMS’ recently appointed head of environmental and social responsibility Neil Prior explains in this month’s edition, there is now a whole generation of people coming through who have environmental and social concerns at the front and centre of what they want from a job.

Those companies that can display strong ESG credentials will gain a competitive advantage in enticing new talent into the industry, Prior says.

We also hear from Katharine Pulvermacher, executive director of the Microinsurance Network, on the drive to build markets for inclusive insurance across the world and reduce the people protection gap. 

Neil Eckert, executive chairman of Conduit Re, outlines his views as to why the fallout from the Russia-Ukraine crisis could spur further momentum in the transition towards a more sustainable future – views echoed by others in recent weeks. 

We also recap the latest announcements, initiatives and peoples moves in the ESG space as insurers and brokers continue to ramp up their focus on sustainability.

 

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