The latest from CRIF for you;
UK insurers will be able to assess the environmental, social and governance (ESG) profile of their UK and EU based suppliers, partners and customer portfolio quickly and effectively, thanks to a pioneering new data repository and scoring service.
ESG Analytics from CRIF, Europe’s leading provider of consumer and business credit information, and a key global player in integrated decisioning solutions, draws on over 130 key indicators derived from UK and EU information sources, analysing information on important areas such as a business’s water usage, waste production, emission, health and safety record, modern slavery and inclusiveness. There has been a growing focus on the need for insurance companies to understand, disclose and reduce their Scope 3 emissions, but ClimateWise* recently found that financed and insured emissions continue to be the most challenging for insurers to measure and disclose.
The organisation, which brings together major insurers as well as the Association of British Insurers, requires members to regularly report on their activities to tackle climate change, but many in the industry currently lack the capability to analyse their full supply chain and the impact of their activity.
CRIF’s ESG Analytics service looks to overcome this, drawing on its unique repository of ESG data as well more than 30 years of experience in advanced analytics, to provide insurers with a quick and accurate picture of the ESG credentials of all UK and European businesses they work with or are considering working with.
To access these credentials, insurers only require the VAT or registration number of a UK or European business to get an ESG score along with the granular environmental, social and governance indicators without the need to engage the individual company itself. The benefits the solution brings to UK insurers include:
- Enhancing pricing competitiveness by exploiting a proven strong correlation between ESG key indicators and loss ratios, improving profitability and competition, and helping insurers to prioritise their relationships with the most sustainable companies.
- Safeguarding against future risks through leveraging the most informative key indicators to build a score than can help identify potential events that could harm the company’s ESG priorities and ambitions.
- Calculating their Scope 3 emissions (namely the Scope 1 and 2 emissions of the portfolio of their client) to boost transparency for stakeholders, better manage transition risks, develop climate-friendly products and support their own sustainability goals.
At present, the UK has no single ESG law or regulation, with policy consisting of domestic and EU-derived laws and regulations, but as part of the Edinburgh reforms in December 2022, the government announced that it would explore a potential regulatory regime for financial providers.
Sara Costantini, CRIF’s Regional Director for the UK & Ireland, said:
“There’s no doubt that protecting the environment for future generations is the number one most pressing challenge for individuals, businesses and governments today. Financial institutions will play a crucial role in the transition to a green economy. For insurers in particular, efforts to reduce their impact on the environment and promote good governance and social responsibility are going to be more and more important in the near future.
“Considering the growing attention of the regulatory bodies towards ESG compliance in the EU but also in the UK, ESG Analytics enables banks, insurers and corporates to understand the impact of businesses they work with today and help inform their decision-making in this ever-more important area of work. And by working with regulatory bodies all around the world, we ensure we remain at the forefront of regulation so we can pass this knowledge onto UK financial institutions.”
CRIF’s new ESG Analytics solution complements its existing ESG service – Synesgy – which allows businesses to easily understand the ESG implications of their entire supply chain, enabling them to collect and view ESG reports, and view the sustainability ratings of the other businesses that they work with.
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