Our understanding of materiality
A key question for any company that seeks to take a long-term view and enable sustainable progress is what this means in the context of its own business and industry: which of its activities and which topics are “material” to achieving this goal?
We first began to address a specific sustainability issue more than 20 years ago when we drew attention to the potential risks created by climate change. Our first effort to disclose sustainability-related information dates back to 1999, when we published a Corporate Environmental Report covering the business year of 1998.
Our overarching commitment
Reflecting this long-standing engagement for sustainable progress, our understanding of “materiality” has developed gradually over time. Our Sustainability Mission Statement, issued together with our initial reports, was the first document to make a public statement; it sought to emphasise the comprehensive nature of our commitment to long-term value creation and listed the areas of our business we considered relevant to this goal.
Over the years, we gradually developed a broader understanding of “corporate responsibility”, though still based on the key notions of long-term value creation and sustainable progress. Reflecting this, we updated our overarching statement and reissued it as our Commitment to Corporate Responsibility: It continues to express our overarching commitment and describes, in general terms, what goals we pursue in which areas of our business.
Our Commitment to Corporate Responsibility
“Corporate responsibility” expresses Swiss Re’s commitment to being an open, honest and transparent organisation that treats all its stakeholders – employees, shareholders, clients, government agencies and the general public – with respect and integrity. In particular, we aim to take a long-term view and to play our part in enabling sustainable progress.
Sustainability as a guiding principle
Sustainable progress – or sustainability – can be described as development that meets the needs of the present without compromising the ability of future generations to meet their needs. To be sustainable, progress must improve economic efficiency, protect and restore ecological systems, and enhance social wellbeing. In all our main activities aimed at implementing corporate responsibility, the principle of sustainability is a key criterion:
- Business solutions
Within our core business of re/insurance and asset management, we strive to develop innovative solutions that help to tackle key environmental and social challenges. To achieve this, we work together with our clients and partners, both in the private and public sectors.
- Risk intelligence
We develop and apply tailor-made tools to extend the scope of our risk management. This enables us to identify and appropriately address sustainability-related and emerging risks in our core business.
- Stakeholder dialogue
Through regular dialogue with our clients and other stakeholders, we help to develop effective responses to sustainability and other key issues, by raising awareness of both the risks and the opportunities arising from them.
- Our footprint
We apply best-practice standards of resource management to our properties and logistic operations as well as guidelines to our sourcing activities. In doing so, we continually reduce Swiss Re’s direct environmental impact.
- Active in society
Playing an active role in society beyond our core business is important to us. Globally, we empower vulnerable communities to become more resilient to risk and, where we have offices, we encourage volunteering activities and support local institutions.
- Our employees
We want to provide our employees with a working environment conducive to their professional and personal development. We nurture a culture of diversity and inclusion across the company, offer excellent training possibilities, and provide a range of health and other benefits.
How we determine key sustainability issues
Our Commitment to Corporate Responsibility is what it says: It expresses our overarching commitment to long-term value creation and our general goals in this respect. It does not, however, specify the specific issues we consider material because these may evolve and change over time.
To determine these material issues, we continuously harness the deep understanding of re/insurance markets and the risk expertise that are embedded in our company. In many areas of our business, we have special teams, functions and processes to identify and address issues relevant to sustainable development. Using this embedded know-how means that we employ a decentralised approach to identify material issues.
In our core re/insurance business, we have special units, such as our Global Partnerships function in the Group or the Environmental & Commodity Markets department in our Corporate Solutions Business Unit, that identify underinsured markets and risks, and seek to expand re/insurance protection through commercially viable solutions. (See special section “Corporate responsibility in context: Expanding re/insurance protection”.)
In our risk management, the challenge is to identify sustainability risks we feel we should not re/insure for ethical reasons, and other risks that may pose a challenge to our own business. We conduct this analysis through our Sustainability Risk Framework and other tailor-made risk management tools.
The expertise embedded in our core business and the issues we identify in this way directly influence the priorities of our stakeholder dialogue, our internal environmental management and our commitment to play an active role in society through the Swiss Re Foundation.
You can find a full list of material issues for all the relevant areas of our business in “Overview of all material issues”.
2014 Financial Report
This includes a “corporate responsibility” section focusing on the link to financial performance (See Corporate responsibility).
Materiality has been a key topic in recent discussions about corporate responsibility reporting. It is our impression, however, that not everyone understands this term in the same way. Some stakeholders define materiality as all of a company’s actions that impact the environment and society; others narrow down materiality to those aspects that have a tangible link to a company’s financial performance.
These two notions of materiality lead to significant differences in reporting focus and scope. This is why we have started to provide an extended chapter on corporate responsibility in our Financial Report that focuses on actions with a strong link to our financial performance.