Lloyd’s vows to help managing agents accelerate ESG strategies
Lloyd’s will increase pressure on managing agents to implement ESG strategies, while also ramping up efforts to attract the right talent to develop innovative products and services, the Corporation’s sustainability director Rebekah Clement has told The Insurer.
Clement, who has led the market’s sustainability initiatives since September last year, said Lloyd’s will be working both individually and collaboratively to help its customers accelerate their transition to net-zero emissions.
Speaking to The Insurer TV, Clement said she would like to “truly see managing agents embed their ESG strategies across their business” as a priority over the next 12 months.
But she also stressed that in order for Lloyd’s to attract the best talent in the industry, having an ESG strategy in place focused on “making progress on culture and diversity targets” would be imperative, emphasising the urgency for the market to get this right.
Further strategies to improve Lloyd’s ESG agenda include a focus on innovative products and services through collaboration.
“This is where our market can really show its strength and its collective capability to lead on new thinking and new ways of providing solutions for what the future low-carbon world needs,” Clement said.
Lloyd’s released an ESG report in 2020 to accelerate its transition to a more sustainable (re)insurance marketplace. The report outlines efforts to align strategies with the UN Sustainable Development Goals, as well as other work focused on diversity and inclusion.
The Corporation recently said its ESG approach was “in line with other regulators’” amid criticism of its position on underwriting fossil fuel projects.
During the interview, Clement commented on the “encouraging results” of The Insurer’s Lloyd’s ESG Survey 2022, while crediting the initiative.
Clement said the survey clearly demonstrated the inroads managing agents have been making towards adopting meaningful ESG commitments.
The independent survey, which achieved a response rate of almost 70 percent of total stamp capacity at Lloyd’s, showed nearly 60 percent of respondents have adopted – or will this year – a net-zero commitment on their investments.
Clement said it was “encouraging” to see that many managing agents view the ESG agenda as a priority at C-suite level.
Some of the success Lloyd’s has seen through supporting managing agents in their ESG endeavours has arisen from the Corporation’s flexibility, rather than “prescriptive guidance”, meaning it can accommodate the needs of managing agents with different sizes and strategies, Clement added.
“We will look through [ESG] strategies, we will give [managing agents] feedback, areas of development, and really seek to work with the market as they get their arms around their own ESG strategies and work that forward into the years ahead,” Clement said.
The years ahead
But Clement also warned that despite the progress that has been made on ESG, the work is not done “by any stretch of the imagination”.
“Over time, we’ll be thinking about how we actually increase our ambition as a marketplace – but ultimately, I think it’s important we have a flexible approach to managing agents and challenge where needs to be challenged, but ultimately hopefully we’ll be seeing some positive actions being taken by managing agents,” she said.
The conflict between Russia and Ukraine and its implications for energy supplies has also highlighted the need for a quick response from the London market.
Clement noted Lloyd’s is in a good position to respond to the needs of the market. To do so, Lloyd’s will continue to support investments in, and further commitment to, new technologies and the scaling up of clean energy to reduce reliance on fossil fuels.