European Insurance ESG Rankings 2023

Dr. Zielke emphasizes: "The European comparison also shows that efforts in sustainability reporting are somewhat declining. Unfortunately, this seems to reflect the current zeitgeist, shaped by war and economic downturn. Nevertheless, we expect that capital market participants will increasingly scrutinize insurers‘ adaptability to climate change, purely from a risk perspective. Young professionals, on the other hand, are already considering whether their employer meets their own sustainability standards. We consider the decline in social reporting in our evaluation to be short-sighted. With CSRD reporting— which, despite strong headwinds, will be delivered by all key players in the insurance sector for the 2024 financial year— we will obtain more extensive information than before and in line with international reporting standards."

Key Findings:

Environmental Progress:

Insurers made slight progress in the environmental category, particularly by disclosing their carbon footprint of their own operations and investments. On average, Scope 1 emissions among the analyzed insurers saw a 3% reduction compared to the previous year. Additionally, 19 out of 21 insurers reported their Scope 1, Scope 2, and Scope 3 emissions for 2023; however, only 10 of them had their CO2 emissions verified through external audits.

Social Performance Decline:

The overall social performance of insurers declined, driven by setbacks in key areas such as inclusion, childcare support, family benefits, social engagement, and customer satisfaction. A significant factor in this decline was the decreased social initiatives and customer relations. Inclusion experienced the most notable downturn, with 11 insurers seeing score reductions between -0.25 and -1.00. Amid these challenges, health management stood out as the only area within the social category to show improvement.

Governance Stability:

Governance scores remained stable overall, supported by improvements in sustainability responsibility and strategy development. While the availability of ESG reports showed no change, SFCR report assessments experienced a slight decline. Among individual insurers, Crelan demonstrated the most notable progress in SFCR, gaining 2 points.

Recognizing Industry Leaders:

AXA emerged as the top performer in the analysis, achieving an impressive 5.47 points and standing out for its transparency and comprehensive disclosure of sustainability-related information. Additionally, Zurich Insurance Group, PrismaLife, and Baloise were recognized for making significant progress in sustainability reporting, further demonstrating their commitment to ESG excellence.

Encouraging Future Progress:

While some insurers made significant strides, there is still room for improvement in transparency and social responsibility. Companies are encouraged to enhance their ESG strategies and reporting to drive greater sustainability excellence. As industry advocates, we stand ready to support insurers in their journey toward stronger ESG performance.