Sustainability conversations started with the finance and insurance industries looking directly at avoiding the business risk associated with climate change (Sustainability 1.0).

In 2006, the United Nations (UN) launched the Principles for Responsible Investment (PRI) to help investors incorporate ESG factors into their investment and ownership decisions. ESG is now referred to as Sustainability 2.0. This was the start of the move from theory to action and prevention.

Enter the UN Sustainable Development Goals (SDGs) – a set of goals to help define and reach the world that we want to live in which takes us to Sustainability 3.0, focusing on measuring the impact businesses have on our societies in a quantitative way.

The majority of business are between stages 2.0 (what businesses do) and 3.0 (what impact businesses have). As the number of commitments grow – e.g. the Paris Agreement, the Net-Zero Asset Owner Alliance, the Net-Zero Insurance Alliance, etc – in order to achieve these commitments there needs to be quantification of how to measure our progress. To create these quantifiable frameworks, agreements need to be made and we need to work together.

Following the pandemic, Co-operators (Canada) is at the point now that the term “sustainability issues” can be replaced by the term “business issues”. The formal part of Co-operators’ SDG and sustainability journey has four phases, tying in with its strategic plan periods.

It started in 2008 with the establishment of a Board Committee, sustainable policy vision and dedicated staff. At first the focus was internal, putting the appropriate structures and literacy in place. In 2011-2014, Co-operators then began to look externally focusing on catalysing others into action. In 2015 to take the next step, Co-operators stopped taking a siloed approach to sustainability and created a corporate strategy with sustainability integrated and co-operative principles embedded throughout. In 2018, the Board established a set of “2030 goals” aligned to the SDGs which will be pursued until 2030. The first step to doing this was to ask members of the Board and Management Sustainability Committees which of the 169 SDG targets created risks or opportunities for Co-operators and its stakeholders. The company officially endorsed all 17 SDGs in 2018, but focused its resources on nine SDGs which it had the expertise to make the most meaningful impact.

Making the SDGs relevant to organisations is not a straightforward process. In order to do this, Co-operators created a set of enterprise goals to help it achieve those global and national goals, while being meaningful to stakeholders and advancing their organisation. The way it is approaching achieving the 2030 goals is through its four-year strategic plans, embedding them into existing (familiar) processes and structures within in the organisation.

As a cooperative, Co-operators has always had a long-term time horizon, but the SDGs have pushed the company to plan more tangibly and provided a new way to think about its impact in the context of global societal needs.

In 2015, when the SDGs and the 2030 Agenda were first launched, the Board and leadership team at Sancor Seguros (Argentina) made a hard commitment, analysing the goals and selecting which of the Goals were aligned with Sancor’s business. It chose seven strategic goals including: health, education, peace and justice, and gender equality; and 50 of the 179 targets. Thinking about what plans it could put in action to compliment these strategic goals and then tried to align this with the 2030 Agenda.

Sancor analysed across the value chain, from its agents to consumers in order to identify the negative and positive impact and what it could do (ie decrease the negative impact, and grow value and the positive impacts). It has been working with a taskforce group of ICMIF/Americas members trying to analyse their contributions to the SDGs. The last two years, it has been analysing all of the contributions to four of the selective goals.

Sancor has taken onboard the message of the UN not to “leave anyone behind” and to work with all of its stakeholders. Dialogue is the key and allows it to know the expectations of its stakeholders, identify the risks, and to manage those risks. Working in alliance with companies, competitors, clients and consumers across the value chain helps Sancor to achieve its strategic goals.

Sustainability had been associated with cost, but that is changing now. Sitting on stranded assets is now the cost, while the opportunity is positioning as sustainability leaders: focusing on new products and services, profitable sustainable growth areas, and being part of the future by future-proofing the business.

In 2006, Unipol Gruppo (Italy) created a social and ethical responsibility function. This identified a connection between its identity, history, and how it was working and managing sustainability issues. While it already had KPIs in place, when the SDGs were proposed, Unipol had to manage its performance on sustainability issues based on more than its mutuality metrics, approach and feeling – but on something universally valid for the first time.

In 2016, Unipol began to identify what positive impacts it could have on SDGs and its level of commitment. Unipol then moved to integrate the SDSs into accountability process, an area which it was already strong. It immediately adopted them in the landscape of the risk in mutuality metrics, but also specific KPIs such as thematic investment and community contributions.

A year later, Unipol started to integrate tools to easily understand the connection each sustainable project in its strategic plans has to the SDGs. In 2019, it effectively created their first strategic plan with integrated guidelines, using the SDGs to analyse sustainability projects, high-value sustainable activities, and also every action in their strategic plan. The tools are used directly by the owner of an action which really engages with middle management to check which SDGs any action will have an impact on, and identify positive impact and define the level of contribution.

Through this, Unipol has identified nine SDGs it impacts on; with three it impact on significantly. Since then, it checks annually to see if the initial interpretation of its SDG impact is correct or not, and if the result was positive in regard to the targets it originally set.

Key messages:

• You don’t have to be complete, you just have to start. This is a journey we need to talk together to have impact. Cooperatives and mutuals as value-driven organisations have a huge role to play, and need to put in place the products, services and risk management approaches to build a more sustainable world.
• Companies often start with the UN SDGs, looking at how to translate them into insurance and tying projects back to SDGs. Getting Board and executive buy-in and securing strategic backing is necessary for longer term investments and to put sustainability at the heart of strategy.
• Developing a common language and metrics is critical to get whole organisations behind them. Financial organisations need financial language and quantification has to come to a common set of measurable metrics organisations can measure against. Swiss Re and some ICMIF members are currently working on translating SDG indicators and metrics into financial metrics that whole organisations can find themselves in and work towards.
• Conversations with stakeholders are key to understanding all the different needs so no-one is left behind and everyone can come together for these goals. Carbon is only one indicator of sustainability and members and stakeholders hold us to all of the goals. While it not a linear process, and the road is long, the key will be paving it together and continuing the dialogue.
• It’s important to make work on SDGs accessible to smaller companies and to think about how they can adhere to the 2030 agenda. There was some discussion on the relevance of international tools, such as the SDG Compass, the impact of COVID-19 on the agenda and the difference between developing and developed countries.

We are in the decade of action and there are high goals for 2030, which is fast approaching. In order to create this quantification, a baseline needs to be established then maturing metrics, bottom-up targets and pathways can be created. Finally, achievable but ambitious industry targets can be developed. While there are many challenges to solve, we can pool our expertise and solve them together by achieving industry consensus on thorny topics and setting standards and targets to move from sustainability 2.0 to sustainability 3.0.   

ICMIF members are working with Swiss Re to create an SDG calculator which large and small companies can use to measure and benchmark themselves. This calculator will be a mutual industry standard which can be shared outside the mutual sector with the whole of the industry.

Session panellists:

• Tom Ewart, Senior Manager, Sustainability, Co-operators (Canada)
• Betina Azugna, Sustainability Manager, Grupo Sancor Seguros (Argentina)
• Marisa Parmigiani, Head of Sustainability and Stakeholder Management, Unipol Gruppo (Italy)
• Alicia Montoya, Head of Research Commercialization, Swiss Re Institute (Switzerland) moderator