If makes environment and anti-corruption part of insurance terms
If Insurance has incorporated sustainability into the company’s underwriting. Corporate clients who don’t support human rights, labor rights and other UN principles, will be asked to level up - or find another insurer.
- We want to motivate all our corporate clients to comply with the UN Global Compact principles, even if they are not corporate members of the initiative themselves, says Morten Thorsrud, CEO of If Insurance.
UN Global Compact is an international initiative for businesses, focusing on 10 sustainable principles, which cover the areas of human rights, labor, environment and anti-corruption. From the beginning of June, the Nordic insurance company has integrated UN Global Compact principles directly into its underwriting standards and into the existing Customer Due Diligence process for corporate clients.
- Most of our clients already work very seriously with UN Global Compact principles and we want to increase the business value of complying with and respecting these standards, he states.
If is the largest P&C Insurance Company in the Nordics and operates from the Nordic countries. Its corporate clients are all around the world.
Encouraging clients to focus on sustainability
To prepare for the change, If has established internal ESG (Environmental, Social and Governance) assessment teams. Relevant If employees have been educated in UN Global Compact principles, norm-based research and the new ESG approach.
To assess how corporate clients respect UN Global Compact principles in their operations, If will utilize research from an external partner that is specialized in monitoring ESG compliance. If’s internal assessment teams will make decisions about client relationships based on the reports and other relevant material.
Notification and improvement
- We have a responsibility to guide our clients. Our role is to work together to develop and help them contribute to a sustainable society in the regions in which they operate, Thorsrud states.
If a corporate client is found to be in breach of one or more of the UN Global Compact principles according to the assessment, the company will be notified and asked to remedy the situation. If a client does not want to or is not able to improve its governance or practice to comply with the principles, it could be asked to find another insurer.
To date, a small number of corporate clients have been notified that their ESG grading is not satisfactory. No client relationships have been terminated.
- Companies that are notified, will naturally have the possibility to remedy the situation and improve, and we already see that clients who have been notified of a violation, are doing their best to become compliant, says Thorsrud.
- Currently, our focus is on our larger clients. It is important to highlight that this is not about whether companies have diesel cars in their car park. It is about protecting human rights, supporting fair labor practices, environmental protection and anti-corruption, Thorsrud concludes.
If has been assessed
The implementation of the UN Global Compact principles into underwriting standards is one of the steps If Insurance has taken to integrate sustainability directly into its business operations.
If Insurance is part of the UN Global Compact through parent company Sampo Group, which joined the initiative in 2019. The UN Global Compact is the foundation for both Sampo’s Code of Conduct and If’s Supplier Code of Conduct.
If has already been through the ESG assessment, like its clients.
UN Global Compact has more than 13 000 businesses as members worldwide. To learn more, visit: https://www.unglobalcompact.org/