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Sustainability and ESG

Sustainability and ESG: The bigger picture

Zurich Resilience Solutions helps address the wider scope of these vital issues.

Say “sustainability” and people typically think of environmental issues — moving to cleaner energy sources or protecting natural resources. Mention ESG (environmental, social and governance) and those familiar with the term might think of similar environmental concerns, as well as workplace diversity challenges, with both issues seen through a prism of compliance with laws or inter-company regulations.

While those topics are indeed a big part of sustainability and ESG, there’s much more to it than that. Sustainability, for example, covers business sustainability as well as environmental sustainability. So, diversity employment initiatives, which might be falsely seen as purely responding to a social issue, are actually extremely important in maintaining a strong, talented and happy workforce. Many professionals now scrutinize a company’s commitment to diversity, equity and inclusion (DEI) when choosing a potential employer. Some investors also factor in a company’s success — or perceived lack of success — in fostering a diverse work environment as they consider their options.

“Based on the generation that you're in, you may view sustainability differently,” noted Mary Vienneau, Risk Engineering Director for Captives, Programs and Direct Markets for Zurich North America. “Younger generations may use their buying power more often based on how a company is embracing sustainability and ESG.”

While DEI matters are a major component of ESG, so is how a company plans for and responds to potential crises like active shooter events or workplace violence. And ESG also covers the dangers of potential exploitation of workers, including human trafficking. Companies that would never engage in such an immoral practice might think that issue is outside their purview, but if vendors or suppliers they work with have been guilty of human trafficking or other worker exploitation — even without their knowledge — they could be vulnerable to risks related to those crimes. (An episode of Zurich’s “Future of Risk” podcast expands on this exposure and can be heard via this link: https://future-of-risk.captivate.fm/episode/ntl-slavery-and-human-traffickingmonth-pt1).

Zurich’s Resilience Solutions team is working with customers to show the wide range of issues that fall under the umbrella of sustainability and ESG, and to help them prepare for and mitigate against related exposures they face now and may face in the future.

Sustainability and ESG are not just matters of good corporate citizenship either. While most companies will need to work hard to meet evolving standards, the good news is that despite the cliché of coldhearted “profits over people” business strategies, it turns out that doing what is good for our colleagues, communities and our shared environment is usually also beneficial in keeping companies financially strong.

“Some people think of sustainability and ESG as some purely government-driven thing,” explained Vienneau. “But there are things you can be doing from a sustainability and ESG standpoint that help your bottom line.”

There are countless good reasons for businesses to tackle these sometimesthorny matters, but the first step is getting a better view of the many different kinds of challenges that fall under sustainability/ESG and actions that can be taken to address them.

Environmental and natural hazard solutions

For too long, climate change and climate volatility were mainly discussed as long-term risks and the potential solutions for those risks. While meeting carbon-reduction targets remains vital across the globe, we are already living in a reality of increasingly frequent and severe weather-related events. The storms, floods and wildfires that make headlines regularly now must be addressed in both immediate and extended planning.

Zurich Resilience Solutions offers several tools and services to help businesses in that planning, and more are in the works.

Available now:

  • Natural hazard and climate risk exposure assessments to help protect business properties. These can include assessments for current and future risks of floods, wind, storms, earthquakes, wildfires, extreme heat, droughts and more.
  • Climate change modeling, which can be part of risk assessments, and allows Zurich to leverage data to evaluate exposures, controls, hazards and potential future events.
  • Weather advisory services. Vienneau said these services provide a “higher, pinpointed view of exactly where a weather event is going to occur based on notifications you select. It really allows you to be able to deploy resources, or not deploy resources, based on what's happening.”
  • Assessments and risk-improvement guidance specific to supply chain and business interruption risks related to natural hazards and climate risks, along with industry-tailored guidance for construction, cyber, fleet and other types of businesses.
  • Loss investigations, which glean post-event knowledge to help businesses build greater resilience after being impacted by an event.
  • Health, safety and environmental program development and audits to help companies stay on top of evolving risks.
  • Weather/water intrusion damage assessments to help reduce water waste.
  • Infrared testing to help in energy-saving strategies.
  • Machinery breakdown investigations to help prevent the release of hazardous materials.
  • Pre-construction site resiliency reviews to support sustainable building.
  • Consultation with LEED-certified professionals. LEED (Leadership in Energy and Environmental Design) is the most widely used standard for sustainable building practices.

Available soon:

  • Carbon advisory services that will use current tools along with evolving technology to help customers measure their carbon footprint and develop sound planning to achieve carbon-reduction goals.

Social issue exposure solutions

As companies work to confront their DEI challenges, they need to remain vigilant on all the other pressing matters related to the people who work for them, the customers and communities they serve, and the contractors or third-party enterprises who work with them.

Zurich Resilience Solutions is committed to offering expertise and guidance to help businesses meet both required standards and live up to company values in these different areas. Some of the tools and services available include:

  • Workplace Diversity, Equity and Inclusion Service: Launched in January, this innovative service can help organizations strategically assess and achieve DEI goals. Zurich’s service was developed to meet a new global DEI compliance standard from the International Organization for Standardization (ISO), and it benefits from a close collaboration with Inclusion Score, the organization that helped create that standard.
  • Crisis management tools and training for workplace violence, active shooter incidents, and other traumatic event prevention and response.
  • Human trafficking assessments and training to help protect workers from harm and companies from the associated liability costs.
  • Safety tools and training covering a range of areas, including return-to-work practices, ergonomics, job hazard analysis, injury prevention and more.

Sustainability and ESG issues need to be top of mind for all businesses, including Program Administrators, as no enterprise is immune from the serious risks they pose. In some instances, not addressing these matters can literally sink a business, especially as standards are codified and regulations or laws are enforced.

“Companies need to understand that sustainability and ESG requirements are coming,” Vienneau said. “Businesses will be asked to report out on what their impact is, environmentally and beyond. Right now, that might be happening more at the larger company level, but midsize and smaller businesses are going to see this wave, too. And suppliers of products and services to larger companies will be asked what they're doing, how they're conforming to sustainability and ESG requirements and report out on those statistics. This is going to happen, whether you want to prioritize ESG and sustainability or not.”

But the risk of exposure should not be the only driver of ESG and sustainability improvements. As noted above, there is much opportunity in taking the next step up in these bold and exciting advancements. Zurich Resilience Solutions is ready to take that journey with its customers.

More information on many of the tools and services highlighted in this article can be found via the Zurich Resilience Solutions Marketplace: zurichna.com/risk/zurich-resilience-solutions-marketplace

Shaz Mohd is Resilience Solutions’ first Director of Sustainability Services

Building on the team’s strong commitment to sustainability, in July Zurich Resilience Solutions welcomed Shaz Mohd as Director of Sustainability Services, a new role within the company.

Mohd’s responsibilities include creating and delivering services to help customers assess and improve their carbon footprint and the environmental impact. He will lead the development of plans for services, identify customers who align with Zurich’s goals, and create a sustainable pricing model. He will also work with Zurich’s Underwriting and Risk Engineering Distribution and Risk Engineering Services teams.

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