RICHARD ROBERTS | Investment Director – Global Insurance

In this article, we consider current sustainability practices, future objectives, and the views of key decision-makers from a wide range of European insurers. Given their long-term investment horizons, risk-management capabilities, and stringent regulatory framework, insurance companies are both highly exposed to ESG (environmental, social, and governance) challenges and, potentially, well equipped to turn some of those risks into opportunities. 

We discuss the key themes that arose from our research, including an overwhelming focus on environmental factors driven by risk management considerations and regulation. We go further to assess the practical challenges associated with developing and adopting decarbonization targets for insurers’ investment portfolios. These challenges are not insurmountable, but they will require insurers, asset managers, policymakers, and regulators to work together to find practical and scalable solutions.