As a global organisation, Zurich Insurance Group (the Group) is committed to investing responsibly and is a signatory to the United Nations Principles for Responsible Investment (PRI). As an investment manager, Zurich Life in Ireland is conscious of the need to ensure that we invest policyholder and shareholder funds responsibly. For the Group, responsible investment is grounded in an economic approach and is all about ‘doing well and doing good’.
‘Doing good’ means that through our investments we can have a positive impact on society and the environment. We see that positive impact as non-financial value – value that cannot be directly translated in dollars and cents, such as ‘tons of greenhouse gas emissions avoided’. This value will benefit the Group’s stakeholders more broadly. ‘Doing well’ means generating superior risk-adjusted investment returns. It recognises that Responsible Investment is not about philanthropy. It also acknowledges that being a responsible investor – for instance through integrating ESG factors or taking long-term views – can also create financial value, i.e. better investment returns.
The Group’s Responsible Investment approach consists of three elements:
- ESG integration
- Impact investing
- Advancing together
Responsible Investment is part of the Group’s investment philosophy and Responsible Investment practices are an integral part of the Group’s investment approach.
We embed Responsible Investment practices throughout the Zurich organisation and in to our culture through:
- Dedicated Responsible Investment objectives are formulated for all members of the Investment Management team and evaluated annually as part of the Group’s performance management process.
- Responsible Investment ‘competencies’ have been defined and are used to describe required skills in job profiles used for recruiting and development purposes for all investment professionals.
- Mandatory Responsible Investment training is provided to all members of the Group’s Investment Management team. Additional advanced training is provided to portfolio managers and analysts within portfolio management teams.
- All teams nominate a ‘Responsible Investment Champion’ tasked with supporting the team in embedding Responsible Investment practices. The network of over 25 Responsible Investment champions holds monthly calls to exchange best practices and discuss progress.
There is only one way in which we manage our assets: as a responsible investor. Responsible Investment is part of our DNA.
The Group sources ESG data and analysis from Morgan Stanley Capital International (MSCI), a third-party specialist data vendor. All of the Group’s portfolio managers as well as analysts in portfolio management teams have access to ESG data and analysis on MSCI’s ‘ESG Manager’ online platform. In addition, the Group feeds ESG ratings into its Global Investment Data Warehouse through which ESG reports can be generated for all securities portfolios in-scope for ESG integration.
The United Nations-supported Principles for Responsible Investment (PRI) initiative is an international network of asset owners, asset managers and investment service providers originally convened by the United Nations Environmental Program Finance Initiative and the UN Global Compact. Over 1,300 organisations representing close to USD 60 trillion in assets are signatories to the initiative. Signatories commit to make steady progress towards implementing a set of six principles:
- We will incorporate ESG issues into investment analysis and decision-making processes.
- We will be active owners and incorporate ESG issues into our ownership policies and practices.
- We will seek appropriate disclosure on ESG issues by the entities in which we invest.
- We will promote acceptance and implementation of the Principles within the investment industry.
- We will work together to enhance our effectiveness in implementing the Principles.
- We will each report on our activities and progress towards implementing the Principles.
More details can be found at www.unpri.org.
The Group has formulated a clear strategy for Responsible Investment since 2012. Becoming a signatory of the PRI formed part of that process, and was the result of a thorough evaluation process. The Group believes that the six principles are well aligned with its strategy for Responsible Investment. The PRI is the foremost organisation to bring together market participants around the topic of Responsible Investment and provides a platform for best practices sharing and a network of like-minded market participants.
Zurich Group signed the Principles for Responsible Investment in 2012.
All signatories commit to make steady progress in implementing the principles relevant in the context of their operations and investment approach. Signatories commit to report on progress made annually through standardised transparency reports. The Group’s report can be found here.