The insurance industry is making a big contribution to sustainability but there are still challenges facing the sector according to the inaugural report of the Insurance Working Group of the United Nations Environment Programme Finance Initiative.
The report – Insuring sustainability: Why and how the leaders are doing it – identified three areas of focus for the insurance industry:
Providing micro-insurance linked to micro-finance;
Researching emerging risks and sharing such knowledge with stakeholders;
Developing insurance products and services for natural resources.
It goes on to identify barriers to sustainable insurance as well as key strategies to develop a market for sustainable insurance. The report calls for the development of principles for sustainable insurance for the global insurance industry. The companies signed up to the IWG include Allianz, HSBC, Swiss Re, American International Group, Lloyds and Norwich Union.
The insurance industry is in a unique position in terms of corporate responsibility. Not only does it have to manage its own social and environmental impacts, but it also helps individuals, businesses and communities protect their assets. And of course, one of the greatest threats to the financial stability of the insurance market stems from the challenge of climate change and environmental degradation.
However, while climate change is the greatest environmental risk confronting the insurance industry, there are also threats posed by issues such as the protection of natural resources and the development of nanotechnologies.
The insurance industry has real strengths in providing risk analysis and scenario planning to help all of society make better informed choices on building a sustainable future. Seeing core business expertise used in this way should act as a great example to others. Practitioners in the corporate responsibility arena should be asking the question – what are the unique strengths of our business that can be brought to bear on informed discussion about sustainable business practice?
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Can we sustain globalisation?
A new report from SustainAbility looks towards 2027 by setting out different scenarios for sustainable development and offers guidelines for business to rise to the challenges ahead. The main message is that businesses must be more flexible, focused and seek out the market opportunities presented by social and environmental issues if globalisation is to be sustained.
The report, Raising Our Game: Can We Sustain Globalization?, published on May 31. offers seven recommendations to business and the sustainability movement:
Build in flexibility – whether in technology, supply chain or human resources;
Focus sustainability efforts and investments on regions and cities in the developing world where the population is booming and development needs are high;
Be aware that even the best corporate citizens can be damaged by scandals, controversies and economic discontinuities;
Serve as a source of market intelligence and creation;
Reframe social and environmental issues not just as risks but also as sizeable market opportunities;
Reach beyond the comfort zone to find new modes, new technologies and new partners in sourcing – and scaling – solutions;
The agenda is political – get involved and take stands.
The report was sponsored by Ford, Novo Nordisk, Shell, The Skoll Foundation and Vodafone.
Unilever is to source all its tea sustainably and has partnered with the Rainforest Alliance to do so. The alliance will independently audit and evaluate the tea farms that supply Unilever against a range of sustainability criteria. Lipton will be the first product to carry the Rainforest Alliance logo and the aim is to have all Lipton Yellow Label tea bags sold in Western Europe certified by 2010 and all Lipton tea bags sold globally by 2015. Unilever is the first business to source all its tea sustainably and the first certified tea will be available from August 2007.
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