Sustainability

Sustainability at Zurich

At Zurich, we believe in action and making a positive impact through our role as insurer, investor, employer and member of the community. We have the knowledge, skills, capabilities and spirit to make a difference through our local* and global sustainability commitments.

This approach has seen Zurich Group rated in the top 1% of the 2021 Dow Jones Sustainability Indices (DJSI) for the Insurance Industry globally.

In June 2019, Zurich became the first insurance company to sign the Business Ambition 1.5˚C Pledge. As part of Zurich’s Pledge, and ambition to be one of the most responsible and impactful businesses in the world, we have set sustainability actions and targets in three core areas: Our operations, our investments and our products.

* You can read about our local sustainability commitments in the ‘drop-down’ headings below.

We are accelerating actions to progress towards a low carbon economy amid an increasing climate crisis, underpinned by our alignment with a 1.5°C future. Locally in Australia and New Zealand, Zurich has committed to:

Reduce absolute emissions from our operations (including electricity, waste, paper, travel etc.) by 60% by 2025, and by 76% by 2029 from our 2019 baseline
100% offset any electricity consumed by end 2021 with the view to use renewable electricity where possible in the future.
Reduce our total CO2e emissions from printed paper by 50% by 2023 and 70% by end of 2025 against 2019 levels by offering digital customer communications (although customers may opt-in to paper-based communications).

Sydney’s Zurich Tower has recently been awarded a 5 Star ‘Green Star’ Rating by the Green Building Council of Australia.

Overall, Zurich globally will continue maintaining carbon neutrality for our operations, which has been achieved since 2014.

As part of our commitment to sustainability, Zurich is a signatory of the UNEP FI Principles for Sustainable Insurance and the Principles for Responsible Investment.

At a global level, Zurich is proud to be a leading responsible investor. On top of investment returns, we are focused on achieving a net-zero investment portfolio by 2050, with 25% reduction in carbon intensity of our portfolio by 2025 compared to the 2019 baseline.

We are also a global leading impact investor. In 2017, Zurich globally became the first private sector investor to introduce impact targets. In 2018, we developed an impact measurement framework to track the success of our impact portfolio. Our portfolio includes green, social and sustainability bonds which contribute funding to renewable projects within Australia and across the globe.

Global impact measurement

USD 5.8 billion in impact investing, which has delivered:

2.9 million metric tons of CO2-equivalent emissions avoided

3.7 million people benefited

Zurich Australia & New Zealand

We measure the impact of our shareholder assets using a
carbon intensity score*.

In 2019 we began with a baseline score of 148.

We are on track to achieving our 2025 target of a 25% reduction in the carbon intensity of our portfolio, which would be a score of 111.

*The carbon emissions of companies (level 1 and level 2) in which we invest, either directly or indirectly are considered. In scope assets are equity and credit asset (ex-semi government and ABS). The emission of holdings are calculated as:

Emission of invested asset = (investment holdings/company enterprise value)* total company emission (level 1 and 2)
Intensity = Emission of invested asset/in scope asset

Some volatility in carbon intensity number is expected

In 2021, Zurich Group announced it is launching a new carbon-neutral investment option for unit-linked life insurance solutions that combine savings with the protection of an insurance policy. The Zurich Carbon Neutral World Equity Fund invests in low-emission companies.

In Australia, the Zurich Investments business advocates for greater awareness and transparency for Australian advisers and Investors on ESG standards and approaches. Watch this video to learn more about Zurich’s efforts in this space:

In the general insurance business, the Group is also expanding its offering for the renewable energy sector, further strengthening its clean energy underwriting capabilities to offer a more complete suite of products and services tailored to support our customers’ transition, which will launch in January 2022.

Zurich also has strict global exclusion policies for underwriting and investing your insurance premiums in alignment with our 1.5°C future efforts. Zurich will not underwrite or invest in companies that:

Generate more than 30% of their revenue from mining thermal coal, or produce more than 20 million tons of thermal coal per year;
Generate more than 30% of their electricity from coal;
Are in the process of developing any new coal mining or coal power infrastructure;
Generate at least 30% of their revenue directly from the extraction of oil from oil sands;
Are purpose-built (or “dedicated”) transportation infrastructure operators for thermal coal or oil sands products, including pipelines and railway transportation;
Generate more than 30% of their revenue from mining oil shale, or generate more than 30% of their electricity from oil shale

We strongly believe that we can use our knowledge, experience and relationships to support our customers, partners and community in a transition of business models that are aligned with a 1.5C future as well as to improve resilience against it.

In 2020, Zurich Resilience Solutions launched dedicated risk management services to help businesses understand their exposure to natural hazards, and tackle climate change risks, addressing current and future physical risks related to natural hazards and climate change, and ultimately helping them to reach net-zero.

Zurich engages with companies that lack targets aligned with the Paris Agreement over a period of at least two years and requires them to set respective targets. Should engagement fail and companies refuse to set targets after due dialogue, Zurich will vote against Board members at shareholder meetings.

Zurich uses Post-Event Review Capability (PERC) methodology to conduct research and independent reviews of natural catastrophes to identify best practice and opportunities for improvement. In 2021, Zurich Australia released a PERC report about the 2018/19 Tasmanian bushfires.

Through the Z Zurich Foundation, Zurich globally contributes to community disaster preparedness and relief, most notable through the Zurich Flood Resilience Alliance. In 2020, Zurich Australia and New Zealand, through the Z Zurich Foundation, invested $2.58m to support bushfire and COVID-19 relief efforts.