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Raphael Thys
To determine the most relevant material topics for Swiss Re, we use our own risk expertise and insights from dialogue with our stakeholders.
In 2022, we conducted a materiality assessment through a structured process, surveying a wide range of internal and external stakeholders to determine sustainability priority topics and define key areas for action. The assessment took into account a double materiality perspective, ie the financial effects of sustainability matters on the firm (financial materiality), and the firm's effects on sustainability matters (impact materiality).
Results
The illustration below shows the sustainability topics currently considered to be the most relevant.
Results of materiality assessment
Material insights from dialogue with our stakeholders
All stakeholder groups prioritised the macro topics (in dark blue) of climate change adaptation and natural catastrophe protection. Decarbonisation also featured prominently as a macro topic for most stakeholder groups. Financial inclusion, biodiversity, financial sector stability, economic growth and cyber security were also often selected.
Among the micro topics (in light blue), ESG risk management and human capital development were viewed as most material. They were followed by the topics workforce diversity, equity and inclusion; claims handling; Board skills and diversity. Data privacy and digital ethics were also selected by stakeholders.
The steps taken in Swiss Re's materiality assessment
To determine the most material sustainability topics, we used internal sustainability expertise and insights from key external stakeholders.
- Topic selection: Swiss Re Group sustainability experts created a list of more than 100 sustainability topics. Based on the expertise of internal sustainability experts from across the business the central sustainability team reduced the list to 27 topics.
- Stakeholder selection: Respondents representing important stakeholder groups and geographic locations and with a broad range of subject matter expertise were selected to participate in the materiality assessment.
- Assessment: The stakeholders were asked to rate the topics in a structured online survey, using the concept of double materiality to inform their decisions. Then, supplementary interviews with a selected number of respondents representing all stakeholder groups were conducted to enrich the survey results.
- Analysis of results: Survey results were analysed by stakeholder group and as a weighted average across all respondents.
- Validation of results: Results were consolidated and disseminated to members of the Group Executive Committee and the Board of Directors as part of the Group Sustainability Strategy 2023-2025 submission. The materiality assessment was audited by KPMG Switzerland.
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Topic selection
The long topic list was based on a range of sustainability standards, such as the Global Reporting Initiative (GRI), the Principles for Sustainable Insurance (PSI), the Principles for Responsible Investment (PRI), the UN Global Compact, the Sustainability Accounting Standards Board (SASB), the Sustainable Development Goals (SDGs) and the CDP questionnaire. Moreover, topics raised in tailored sustainability assessments performed by third parties (RepRisk and Sustainalytics) were taken into account for the initial list.
For the selection of the final list of 27 topics1, duplicate topics were consolidated, and then internal experts evaluated the potential and actual impacts according to both materiality aspects, considering a range of opportunities and risks, and real business examples.
The topics were then categorised into macro or micro topics. Macro topics are those that concern our re/insurance and investment activities. Micro topics, on the other hand, pertain to operations and conduct, focusing on our own operations, as well as our governance and compliances practices. Micro topics are considered crucial in enabling business activities, ie macro topics.
Stakeholder selection
We considered the following groups for the materiality assessment:
- Clients: cedents, brokers, corporate clients, government entities, multilateral organisations
- Financial community: investors/shareholders, rating agencies
- Employees
- Political and public entities: multilateral organisations, governments, regulators, standard-setting bodies
- Civil society: NGOs, academia
The online materiality survey was distributed to a selected number of internal and external stakeholders. Attention was paid to select stakeholders covering the three main geographical regions in which Swiss Re is active (Americas, Asia, EMEA), employees from different Group functions (eg Risk Management, Communications, Group Strategy, Group Tax), Business Units (Reinsurance, Corporate Solutions) and Divisions (iptiQ, Public Sector Solutions). The one-on-one interviews were conducted with a subset of respondents from each type of stakeholder group and geographical region.
Assessment
The stakeholders were asked to rate the topics in a structured online survey, using the concept of double materiality to inform their decisions.
According to the concept of double materiality, which we used for the assessment, a sustainability topic is material from a financial perspective (ie the financial effects of sustainability matters on the firm) or from an impact perspective (ie the firm's effects on sustainability matters). Respondents were asked: "Which topic do you think could most affect the financial value of the company within the next three years?", and "Where could Swiss Re have the most significant impact on the environment and/or people within the next three years?".
Supplementary interviews with key respondents were conducted to enrich the survey results. The interviews explored the reasoning for the respondents' ranking choices, opportunities and risks for these topics, and improvements to Swiss Re’s Group Sustainability Strategy.
Analysis of results
More than 1000 respondents participated in the online survey, of which close to 120 were external stakeholders. Of those, 22 respondents belonged to civil society groups. Furthermore, 87 clients, 8 investors, and 930 employees responded. To account for the disparity in group size, the plot above displays a weighted average.
In addition, we conducted 45 personal interviews: 27 with senior management across Swiss Re functions and regions, and 18 with external stakeholders including clients, investors, and members of civil society, NGOs, and academia. The interviews affirmed the importance of decarbonisation and natural catastrophe protection as key topics for Swiss Re.
Validation of results
The assessment was presented to the Group Sustainability Council, which includes several members of the Group Executive Committee. Furthermore, results were consolidated and disseminated to members of the Group Executive Committee and the Board of Directors as part of the Group Sustainability Strategy 2023-2025 submission. Lastly, the materiality assessment received limited assurance by KPMG Switzerland. We plan to conduct the next regular assessment in 2025.
Footnote:
1The full list of 27 topics evaluated by respondents: Anti-corruption, Board skills and diversity, Claims handling, Consumer protection, Data privacy and digital ethics, Employee personal resilience, ESG risk management, Fair compensation, Human capital development, Human rights protection, Operational carbon emissions, Responsible sourcing, Tax responsibility, Workforce diversity, equity and inclusion, Biodiversity, Circular economy, Climate change adaptation, Critical infrastructure, Cyber security, Decarbonisation, Economic growth, Financial inclusion, Financial sector stability, Food security, Health protection, Household and income protection, Natural catastrophe protection.