African Risk Capacity (ARC) Limited has received the global insurance industry’s top overall environmental, social and governance (ESG) scores.
Conducted by Sustainalytics, a leading ESG research, ratings and data firm, the evaluation is a comprehensive assessment of an organisation’s preparedness to meet future risks and opportunities linked to ESG factors, such as climate change, regulatory risk and reputational issues, on a scale of 0 to 100, with 0 indicating the lowest risk.
ARC Ltd.’s ESG score was calculated following an independent audit of the company’s business practices and policies. Improving from low risk last year at 10.2 to negligible risk this year at 5.7, Africa’s premier institution for disaster financing edges up two positions to claim top spot in the global insurance sector ESG risk rating. ARC Ltd.’s ESG risk rating is now the lowest among its global peers.
ARC Ltd. also retained its leadership position in the Diversified Insurance sector this year, with the lowest exposure among its peers (24.0) and strongest management score (80.3) in terms of how well it manages its ESG programmes, practices and policies.
In particular, ARC Ltd. scored negligible risk ratings in terms of Data Privacy and Security, Corporate Governance, Human Capital, Business Ethics and ESG Integration.
ARC Ltd. Chief Operations Officer Ange Chitate says the organisation’s top ESG score in the insurance industry is reflective of the leadership role it plays in helping to mitigate and manage the impact of climate change on the African continent.
“This independent validation of our commitment to sound ESG practices within the business bolsters our vision to cover the continent’s most vulnerable communities facing the vagaries of climate change events. We achieve this through partnerships with like-minded organisations that share our vision and commitment to sustainable ESG practices,” says Chitate.
As a leader in ESG among stakeholders in Africa’s insurance sector, ARC Ltd. is a signatory and driver of the Nairobi Declaration, aimed at committing the continent’s insurers to better integrate ESG into
their business models, in alignment with the goals envisioned by the Net- Zero Insurance Alliance.
“We are determined to play an active role in promoting the economic, social and environmental sustainability that has become so crucial in the world today. All stakeholders within the African insurance industry – from risk managers to insurers and investors – have a critical part to play in promoting sustainable development on the continent,” says ARC Ltd. CEO Lesley Ndlovu.
“We encourage others in the industry to take the initial step of becoming a signatory of the Nairobi Declaration, but also advise that it represents just the first footfall on a path towards numerous different activities and accommodations like those illustrated in our independent ESG risk assessment by Sustainalytics. We can all play our part,” Ndlovu concludes.