three people wearing protective clothing

Our positions

Zurich takes economic, social and environmental risks into account in its decision-making

How do we define sustainability risk?

Sustainability risks are often systemic, complex and evolving so it is especially important for companies to regularly review the materiality of these issues. Materiality defines why and how certain sustainability risks are important for a company by assessing their importance to stakeholders, both internal and external. Zurich performs a double materiality assessment (DMA) to identify those sustainability matters that are most material to our stakeholders, while also considering how they influence our company. This deepens our understanding of our risks, opportunities and impacts.

Read more about our strategy 

Zurich’s approach

Zurich has positions and frameworks in place that define the business activities for which the company has limited underwriting or investment appetite, which are applied in accordance with applicable laws and regulations.

These cover:

Our underwriting approach

Society is facing interconnected and complex challenges. The insurance industry must, where appropriate, play its role in addressing these challenges as a manager of risk. That is why we work with our corporate customers and brokers to better manage sustainability risks and strive to promote best practices.

We engage with customers to understand their business and operations and work together to ensure that responsible and sustainable practices are in place. This enables us to make better-informed decisions on how we can support customers in developing best practices.

We also provide guidance and training for underwriters and other relevant stakeholder groups and have established sustainability risk assessment and referral processes.

Zurich tracks and monitors volumes and types of sustainability risks in business transactions internally within the Group. Significant changes in sustainability performance can be monitored and assessed accordingly.

In addition to the positions followed by the Group described above, we pay special attention to:

While important for the world’s continued economic development, the construction of hydroelectric dams, mining projects and oil and gas production can have significant negative environmental or social impacts if they are not planned and executed in accordance with international best practices. Where providing insurance for such projects, we pay special attention to:

  • human rights abuses, such as relocation of local communities without due process (including absence of free, prior and informed consent (FPIC))
  • potential environmental impacts and if operations are located within protected areas

Dam construction: Dams help communities and economies manage water resources for food production, energy generation, flood alleviation and domestic and industrial use. But they can also displace communities, cause adverse environmental impacts and create political risks including the inequitable distribution of benefits.

Mining: Mining provides minerals and metals that underpin economic growth and social welfare. If not managed responsibly, mining operations can have adverse impacts on the environment, host communities and countries.

Oil and gas: The main points are described in the Group’s fossil fuel position.

Responsible investment, ESG integration and impact investing

We believe that proactively integrating sustainability risks and opportunities in our investment decisions will help us to do our job well on a long-term basis (ESG integration). ESG integration – across asset classes, and alongside traditional financial metrics and state-of-the-art risk management practices – helps us to achieve superior risk-adjusted, long-term financial returns.

Read more about responsible investment 

Our operations

Due to the nature of our business, we are predominantly consumers of services and not products or raw materials. Compared with other industry sectors such as manufacturing, the impact of sustainability risks on Zurich’s supply chain are low. Nonetheless, we are committed to effectively managing such risks.

Read more about sustainable sourcing