Insurers have greatly improved their sustainability reporting

11/15/2022 – In the CSR study “ESG company ranking of insurance companies 2022: The devil is often in the details” by Zielke Research Consult and Morgen & Morgen, 40 (37) companies have achieved a medal. Axa, Zurich and Gothaer fared better.

“Most of them are on the right track. However, we are still a long way from being able to judge whether insurers have reached the 1.5 degree path”, says Dr. Carsten Zielke, Managing Director of Zielke Research Consult GmbH, presenting the study “ESG Company Ranking Insurance Companies 2022: The devil is often in the details.”

gold silver Bronze

Carsten Zielke (Image: Zielke Research)
ZRC CEO Carsten Zielke
(Image: Zielke Research)

For the fifth time, Zielke has examined the reports of German insurers on their “Corporate Social Responsibility” (CSR). Again 50 groups/corporations participated. An average of 2.81 points was awarded for the three sub-areas “Environment”, “Social” and “Governance”. In the previous year it was 1.48 (VersicherungsJournal November 11, 2021).

Twelve (14) companies had enough points for the gold label, 16 (14) for “silver” and twelve for bronze. In the overall ranking, the Axa Group ranks first, followed by Zurich Insurance Group, Gothaer Versicherungen, Helvetia Versicherungen and Sparkassenversicherung Sachsen.

With only 0.34 (previous year 1.07), the Huk-Coburg Versicherungen lost the most points in the overall evaluation, “because it has lost even more transparency compared to the previous year, in which it was already below the average transparency. The Continentale insurance association ranks last. All company reviews can be found at this link.

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What is the ranking of ESG companies about?

In particular, the “Social” area improved with 3.17 (1.47) points. “Governance obtained 3.02 (1.92). An average of 2.26 (1.11) points was awarded to “environment”. The point scale goes from minus 4.67 (3.68) to plus 5.25 (4.58) points. All three categories are equally important in the evaluation.

An essential point in the “environment” are carbon dioxide (CO2) emissions (the study does not cover other greenhouse gases) or efforts to reduce them and calculate direct and indirect emissions (so-called Scope 1 to 3) . When it comes to range information, Zielke complains of “some inconsistencies with respect to the detailed calculations.”

According to Zielke, for the first time in the series of studies, all the insurers analyzed reported on the measures they had taken and implemented to reduce CO2 emissions. 36 percent remained faithful to the “precise and evident description of their CO2 reduction measures”.

Where insurance companies get stuck

In order for companies’ greenhouse gas emissions to be measurable, they are divided into three emission sources (scopes) according to an international procedure. Scope 1 records the direct emissions of a company for the production and generation of electricity and steam, Scope 2 the indirect emissions for the purchase of energy for its own consumption.

All indirect emissions that occur along the value chain will be accounted for in Scope 3. However, companies have no influence over the latter and they appear to be difficult to calculate. Zielke notes that scope 3 should also be expanded to include short-term equity investments and will also apply to medium-term risk underwriting.

Of the 50 insurers, 72 (62) percent published the Scope 1 value in . A good half based their calculation method on the international framework “GHG Protocol”. Only ten insurers had their scope calculations verified by an external third party. In half of those examined, CO2 emissions per employee increased compared to the previous year.

greenwashing risk

“Companies should consider checking their CO2 emissions so that suspicions of greenwashing are not raised in the first place,” Zielke demands. In general, the industry will have an average CO2 emissions of 0.66 (0.59) tons per employee in 2021.

The project was again financed by 13 insurers. Details about the evaluation can be found at this link.

Insurers can use promotional labels

Insurers can use your location (medal) in their communication for a fee as part of a cooperation between Zielke Research and Morgen & Morgen GmbH. The ESG company rating label is part of the analysis and comparison software for insurance brokers “M&M Office”.

Eleven of the “Gold” winners will wear it, and two of the “Silver” winners are expected to wear it.

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