Insurance industry bodies back UN ESG principles

Leading insurance companies and industry bodies from across nations and regions have committed to a UN-backed programmes to green the sector and promote responsible investment globally.

Along with a number of industry associations, an alliance of nearly 30 companies – together worth more than $5tn (£3.2tn, €4tn) in assets – has signed up to the Principles for Sustainable Insurance to provide insurers with environmental, social and economic sustainability risk management tools.

And a global provider of asset and risk management services for the insurance industry has also endorsed the UN Principles for Responsible Investment (UNPRI).

The sustainability principles cover the management of many risks, including climate change, natural disasters, water scarcity, food insecurity and pandemics. The UN says they represent the first insurance industry framework that accounts for the economic value of natural and social capital and good governance.

UN secretary-general Ban Ki-moon called the agreement “historic”, and added: “For years insurers have been at the forefront of the corporate world in alerting society to the risks of climate change and, more recently, threats such as the loss of biological diversity and the growing pressures on forests, fresh water and other essential ecosystems.

“Insurers are also increasingly recognising the need to develop products that address the needs of a rapidly changing world, including inclusive insurance that caters to low-income communities, people with HIV and Aids or disabilities, and ageing populations.”

Signatory companies will publicly disclose their progress in implementing the principles annually.

The move is the result of a six-year global development process that has been conducted by the UN Environment Programme’s Finance Initiative.

Meanwhile, leading asset and risk management provider Conning has signed up to the UNPRI.

The UNPRI, formed in 2005 by 20 of the world’s largest institutional investors, now has more than 1,000 investor signatories and is a voluntary framework by which all investors can incorporate ESG issues into their decision-making.

Conning president Woody Bradford said: “Given our global presence, we feel it is necessary to more formally support the implementation of responsible investment principles throughout the world.”