The UK’s RSA Insurance Group, which was known as Royal Sun Alliance until earlier this year, appears to be seeking more than a name change. The Group recently became a signatory to the UN Global Compact and joined Insuring for Sustainability, an initiative by major insurers seeking to address the intersection between financial risk management and the world’s most pressing environmental and social challenges.
The Insurance Working Group (IWG), as its called, was established in 2006 and currently has 18 members, including many of the world’s largest insurance companies. The concept of sustainability is not new to the insurance industry. In fact, companies like Munich Re and Swiss Re were some of the first corporations to recognize the link between sound financial management and sustainable business practices. Since the business of insurance is first and foremost about assessing and transferring risk, it is not hard to see how the rising financial costs associated with natural disasters and other man-made events forced these companies to make climate change a business imperative well before the topic hit the mainstream with films like An Inconvenient Truth.
Duncan Minty, an independent advisor on corporate responsibility, has just written a compelling article called Fighting the Good Fight that appeared in the UK’s Post Magazine in September. Minty explains that while “Insuring for Sustainability” sounds like a great idea, the real test is whether the insurance industry will be able to ante up in terms of transparency.
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