ESG gains space in the insurance sector
In 2021, S&P Global released its first report detailing the impacts of ESG principles – an acronym for environmental, social and governance practices – on insurers. Since then, the practices have been gaining ground in companies. In Brazil, Susep opened a public consultation, number 44, in order to establish guidelines for the insurance market to include the assessment of environmental, social and governance impacts in its businesses.
According to information from Valor Econômico, the draft of the Susep circular requires the inclusion of sustainability risks in the traditional risk management of insurers, the creation of a sustainability policy and the preparation of an annual report detailing risks and opportunities. In addition, insurers’ investment portfolios will also be composed of companies that follow ESG principles. Tokio Marine already adopts some ESG principles. The director of growth and marketing strategy at the Japanese insurance company, Flávio Otsuka, notes that the company does not accept new contracts from groups that operate with fossil fuels, and that maintain relations with their employees analogous to slave labor.
Tokio created a multidisciplinary team focused on the ESG issue and launched the first product with the seal, that of environmental risks. Generalli adopted similar criteria. Superintendent Débora Pinto informs that the company created guidelines for responsible underwriting that describe principles for evaluating clients in the three aspects of the acronym ESG. “I believe that greater synergy of initiatives between insurers can bring faster and more assertive results to our society.” Solange Beatriz, executive director of CNseg, a confederation that brings together companies in the sector, believes that Susep’s regulations will lead to relevant changes in companies’ policies in measuring climate risks within their businesses. “In two years we will have concrete evidence of proactive actions by the sector. Companies are creating frameworks to develop processes, methodologies, goals and metrics.
Without it, it just stays in the speech. And this kick-start has already been given”, says the director of CNseg in an interview with Valor, which created a technical commission with executives from the insurance companies to deal with the issue. The topic has already migrated from the sustainability area to the insurance business area. One of the focuses is on the development of metrics. “Susep’s regulations allow each company to adopt its own tool, but CNseg is working with consultancies to help the sector define parameters for measuring ESG practices”, she explained.