Why it matters

The choices we make about our investments and the risks that we underwrite are an important opportunity for positive impact.

Environmental, Social and Governance (ESG) covers a wide range of areas, such as whether a business uses energy responsibly, considers human rights issues and consumer welfare, or displays good checks and balances in the way it is run. We are working to embed ESG considerations into our business decisions.

In addition to being the right thing to do, a positive approach to ESG issues is a good indicator of the overall quality of a business’s management practices, and therefore their likelihood of long-term success.

Our approach

As a signatory to the United Nations Principles for Sustainable Insurance (PSI) and a member of ClimateWise, it’s important that we make informed decisions about the types of risk we choose to underwrite and where we invest our premiums.

To oversee our approach, we have established an ESG Committee, chaired by our Group Chief Risk Officer and comprising senior representatives from investment, underwriting and risk teams. The Committee is responsible for assessing key issues, recommending our company position and monitoring how these are integrated into business practices.

In 2019, the committee reviewed ESG issues associated with higher-risk sectors and developed a new Group-wide Climate Change and Low Carbon Policy. This outlines our role in insuring renewable energy generation projects and restricts capacity available to carbon-intensive industries.

Responsible underwriting

RSA operates in a global environment and we are frequently asked to provide insurance across borders. As part of maintaining an appropriate level of scrutiny for the work we do, our Underwriting Policy promotes responsible practices, assessing potential customers in high risk sectors or locations against ESG criteria.

Our high-risk country framework provides guidance and requirements to refer the writing of certain business or the payment of certain claims to a more senior level where a matter is linked to a country that RSA deems higher risk in certain regards.

Responsible Investment

Our Investment team considers the ESG policies that external fund managers have in place as part of the appraisal process for onboarding any new managers. We also use specialist data sets to review the overall ESG performance of our investment portfolio

• 90% funds managed by signatories to the UN PRI

Insuring renewable energy

We are committed to playing an active role in the transition to a low-carbon economy, renewables currently make up 65 per cent of our energy underwriting portfolio. Our Renewables teams underwrite renewable energy projects across the world, providing cover for the construction and operation of wind, solar, hydro and bioenergy developments. They work closely with manufacturers and developers to advise on the best approach for upcoming projects, reduce risks, and support claims.