"This isn’t going to happen overnight but by helping clients identify, manage and measure areas that are in need of improvement, we can help them implement incremental changes that will pay dividends in the long-term."
- John Fowle, Chaucer chief executive officer
However, according to green and sustainable finance campaigners, the financial legislation falls significantly short of the long-awaited provisions on sustainability-related disclosures with the achievement of net-zero given second-tier billing on the regulatory agenda, reports Responsible Investor.
“The UK has made a number of commitments in its role as COP president but the lack of a strong climate focus in this bill could be a canary in the coal mine with regards to whether these can be achieved,” said one UK sustainable finance expert who requested anonymity.
Following the bill’s second reading yesterday (07/09) global specialty (re)insurance group, Chaucer, has announced the rollout of their ESG Balanced Scorecard across underwriting, investments, and operations. This initiative is in collaboration with Moody’s and will measure the ESG data-driven performance of clients and business partners, helping them to become more sustainable.
One of the main aims of the ESG Balanced Scorecard is to help incentivise businesses to make more ESG-related disclosures. Chaucer says that the major challenge facing the (re)insurance industry is having access to relevant and reliable ESG data to assess counterparties.
The ESG Balanced Scorecard has been designed to approach ESG risks holistically, using 158 unique data points to assign scores for corporates across underwriting, operations, and investments. These data points include disclosure of greenhouse gas emissions, boardroom diversity, and integration of environmental factors into the supply chain.
Chaucer says the adoption of ESG scorecards across the (re)insurance industry would be a valuable initiative, not only enabling (re)insurers to manage their own ESG profiles but also helping (re)insurers better understand potential risks and areas for improvement related to the ESG of their customers.
Commenting on the launch, John Fowle, Chaucer chief executive officer, has said:
"The (re)insurance industry has a pivotal role to play in helping corporates make the transition to become more sustainable.
“(Re)insurers need to consider their own ESG profiles and what action the industry as a whole can take to improve its credentials. The data provided through the ESG balanced scorecard will help Chaucer and other (re)insurers establish their strengths and weaknesses and give them a steer on which areas need greater attention or investment.”
Colin Holmes, Moody’s Analytics general manager of insurance, added:
“Chaucer has been a crucial development partner to help us reach this point. We are delighted they have been able to leverage the capabilities of our ESG insurance underwriting solution to create a first-of-a-kind ESG balanced scorecard to provide a transparent and authentic approach to ESG risk assessment.”
