October 2021 | The ICISA INSIDER
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Column
How well do we do on the scale of sustainability? By Richard Lange, Arch RE A privilege of living in Switzerland is having the ability to enjoy nature and go out to the mountains. After having experienced a very rainy 2021 summer, I took immediately the opportunity of the first sunny day in September and went out for a day hike. Discovering another new lake (this one at an altitude of 1000m) triggered me to read more about “the Swiss and their water”. Some numbers: Switzerland has around 1500 lakes that together with rivers make up 4% of the total land mass, 6% of Europa’s water resources are linked to Swiss rivers & glaciers and Switzerland has 677 hydro plants producing 56% of total annual energy output. What is the reason for sharing this? Whilst scrolling the web for info on water, I noticed many articles on the melting of the Glaciers. More than 500 of them have completely disappeared since 1850 in Switzerland and glaciologists calculate that the remaining 1500 will not exists by the end of this century if CO2 emissions are not reduced. It reminded me of a great experience from April, where thanks to enthusiastic colleagues at Arch, we joined the Earth Month Eco Challenge (279 companies and 564 teams), a solutionsoriented challenge focused on reducing greenhouse gases in the atmosphere. The outcome for me was not only becoming more aware of several environmental aspects but more importantly acting to change old, embedded habits into new, better ones. Here is where I like to make a bridge to our (re)insurance industry. Did lockdown show us that we don’t need to travel to keep the business going? Will we continue the path of working remotely and using fewer forms of transportation that are polluting? Or will we return to our old habits and meet in person without much thought for the impact? Easy questions, but likely getting very different answers when speaking with market colleagues on this. I think it is anyhow good to see that the large majority of (re)insurance companies have meanwhile taken it broader and put emphasis on corporate responsibility (environment, social, governance). Thinking about these three aspects, the question is what
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this means for our line of business? Will it influence our underwriting stance? Does this mean declining a request to cover performance bonds on a project that likely endangers nature? Exclude a credit limit on an obligor where it is not clear whether labor rights are fully respected? Can one make such an individual decision without a directive from Governments or International Organizations? All in all, not an easy topic to take up, but I think we have arrived at the point exchanging views on ESG within ICISA and what it means for us. I sincerely hope to see this topic more regularly as a standing item on the agendas of the respective committees. As with many things in life, it all starts with awareness…
