United Nations meeting in Johannesburg ahead of Rio+20 will formulate principles and actions by which to keep insurance sustainable in a changing world
An influential gathering of businesspeople, change management strategists, scientists and global scenario planners took place in Johannesburg in March in the first of a series of global regional meetings that will drive fundamental changes in the insurance industry around the world.
The meeting, the PSI (Principles for Sustainable Insurance) Regional Consultation Meeting for South, West and East Africa, is a project of the United Nations Environmental Programme Finance Initiative (UNEP FI) and is presented by the UN and hosted by Santam and the South African Insurance Association (SAIA). Its specific purpose was to consult on the draft principles for sustainable insurance (PSI) ahead of the United Nations Rio+20 Conference on Sustainable Development scheduled for May, 2012.
It is seen as a groundbreaking and crucially important gathering for the insurance industry nationally, regionally and globally as the industry comes to terms with the inevitability of rapid change in climate, in regulatory environments, in governance and in socio-economics.
Speakers included Peter Willis (Director of the Cambridge Programme for Sustainability Leadership in South Africa); Deon Nel (Ecosystems Research, Natural Resources and the Environment at the CSIR); Ian Kirk (Santam CE); Vanessa Otto-Mentz (Head of Strategy for Santam; Board member for Africa UNEP FI Insurance Commission; and Strategic Coordinator for Sustainability in the short-term insurance industry); Paul Clements-Hunt (Head of the UNEP Finance Initiative); Butch Bacani (UNEP FI); and Barry Scott (South African Insurance Association Chief Executive).
Topics for discussion included: The Rationale, Process and Aims of the PSI Agreement and the Principles themselves, The Loss and Damage Component of Cancun Agreements; and UNEP’s Proposals to the UN Framework Convention on Climate Change.
Ian Kirk comments that growing systemic risk is a crucial issue for the insurance industry; it is his hope that Santam can, in partnership with SAIA and other players, improve the management of these risks. It is his specific objective to achieve better management of systemic risk during his term as Santam CE.
“The PSI, or principles for sustainable insurance, is of crucial importance to the industry,” says Vanessa Otto-Mentz. “The world in which we live, and in which we do business and offer a service, is beset by rapid change. Among these are changes in climate and weather that profoundly impact risk and risk management. However, there are other changes, too, that the industry must contend with. They include changes in governance; in the regulatory environment; and in communities and society at large. The Johannesburg meeting will consider the principles developed by the PSI workgroup and will evaluate them to measure their soundness for full business sustainability.”
Butch Bacani, programme manager for the PSI workgroup, says the issues are “critically important‟ for insurance businesses globally. “The whole industry has a crucial role to play in supporting sustainable economic development. This workshop will be a means by which to consolidate and further that work.”
SAIA Chief Executive, Barry Scott, looks forward to the discussion and, especially, to reaching agreement with SAIA members, partners and stakeholders in the broader industry. “SAIA is proud to be affiliated so strongly to this meeting and to creating and enabling an environment for the United Nations on the sub continent.”
Viviene Pearson, General Manager at SAIA, adds: “PSI consultation will lay solid foundations for the path ahead, bringing greater sustainability to insurance. I look forward to the United Nations meeting – and especially to the difference it and future meetings will make to the insurance industry at national and international level.”
The principles will include concrete actions for long-term success and sustainability of the industry value chain. They will consider the full range of risks and opportunities those risks present. They include underwriting risk; product and service development matters; claims management; environmental, social and governance risks; and business strategies and operational issues.
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