Message from the UN Secretary-General
The thousands of companies that have embraced the United Nations Global Compact and the Principles for Responsible Investment demonstrate the growing influence of sustainability in business. The launch of the Principles for Sustainable Insurance at the UN Conference on Sustainable Development (Rio+20) is a further evolution of this important movement to build a green economy. Developed by the UN Environment Programme’s Finance Initiative, the Principles are a framework for the global insurance industry to address environmental, social and governance risks and opportunities.
For years, insurers have been at the forefront of the corporate world in alerting society to the risks of climate change and, more recently, threats such as the loss of biological diversity and the growing pressures on forests, freshwater and other essential ecosystems. Insurers are also increasingly recognizing the need to develop products and services that address the needs of a rapidly changing world, including inclusive insurance that caters to low-income communities, people with HIV/AIDS or disabilities, and ageing populations.
Insurers have worked with the UN World Food Programme to cover small-scale farmers in Africa so that, should the rains fail, a policy pays out before they are down to their last cow or supply of maize. The UN Environment Programme, with funding from the Global Environment Facility, has partnered with insurers to develop wind power derivatives in Mexico that cover a wind farm during less windy periods. And the success of initiatives such as the UN-REDD programme on reducing emissions from deforestation and forest degradation may hinge on whether insurers can cover the long-term challenge of keeping forests intact.
The Principles for Sustainable Insurance provide a global roadmap to develop and expand the innovative risk management and insurance solutions that we need to promote renewable energy, clean water, food security, sustainable cities and disaster-resilient communities. With world premium volume of more than $4 trillion and global assets under management of more than $24 trillion, insurers that embed sustainability in their business operations can catalyze the kinds of financial and investment flows and long-term perspectives needed for sustainable development.
The United Nations looks forward to working with all sectors of society towards the global embrace of this important new initiative as we shape the future we want.
Secretary-General of the United Nations
Message from the UN Under-Secretary-General & UNEP Executive Director
The world in which now seven billion people exist is becoming a riskier place to live and to operate as a result of accelerating environmental change and the interconnectedness of societies, economies and supply chains.
Meanwhile, consumers and citizens are demanding higher levels of accountability and transparency from governments and companies, and policies, products and services that reflect the challenges and opportunities of a new century.
The insurance industry’s core business is to manage risk and in recent years more and more insurers have been responding to environmental, social and governance (ESG) issues at varying levels and scales.
Over the past six years, the UN Environment Programme’s Finance Initiative has been exploring the possibility of establishing sustainability principles for the global insurance industry that can catalyse and amplify transformational change. Principles that tailor to the needs and aspirations of the insurance industry and the clients and citizens it serves.
The result is four overarching Principles for Sustainable Insurance launched at the Rio+20 Summit in June 2012, two decades after the Rio Earth Summit of 1992 that set the course for contemporary sustainable development.
In 1992, the risks to people and the planet from accelerating environmental degradation and social inequalities were just being glimpsed. Now they are fast becoming a reality for every man, woman and child alive today.
Under the Principles for Sustainable Insurance, insurers joining this global initiative are embracing fundamental aspirations and turning them into concrete actions. These range from integrating ESG issues into a company’s management and operational DNA, to working together with clients, suppliers and governments to raise awareness of ESG issues, alongside developing new kinds of risk management products and services.
Seven billion people, rising to over nine billion by 2050, are not going to stand still and wait for the future they want. We need to green our economies, build resilient communities, deliver wider ranging social outcomes, and better conserve our forests, freshwaters and other critical ecosystems.
The Principles for Sustainable Insurance are a foundation upon which the insurance industry and society as a whole can build a stronger relationship—one that puts sustainability at the heart of risk management in pursuit of a more forward-looking and better managed world.
Under-Secretary-General of the United Nations
& Executive Director of the United Nations Environment Programme