Lloyd’s has detailed a number of Environmental, Social and Governance commitments it says will help integrate sustainability and inclusivity into the speciality re/insurancemarketplace’s business activities.
Lloyd’s will create a cultural toolkit and set of regularly measured targets, including a phase one target of 35% female representation in leadership positions across the market – to be achieved by 31 December 2023.
New targets for black and minority ethnic representation in leadership positions will be announced in 2021.
Lloyd’s will also encourage all insurance undertakings in its market to allocate 2% of annual premiums towards innovative and sustainable products by 2022.
A new risk centre will be developed and launched in 2021, with an aim of undertaking research into new insurance products designed to protect society from systemic risks, including climate risk.
Lloyd’s is also targeting a 5% allocation of the central fund to impact investments by 2022 and will end investment in thermal coal-fired power plants, thermal coal mines, oil sands and new Arctic energy exploration activities.
This involves ending new investments in these areas by Lloyd’s market participants and by the corporation, from 1 January 2022.
There will also be a phasing out of existing investments in companies with business models that derive 30% or more of their revenues from thermal coal-fired power plants, thermal coal mines, oil sands or new Arctic energy exploration activities by the end of 2025.
Lloyd’s intends to publish a road map that will set out how the corporation will become net zero in its operations by 2025.
Furthermore, managing agents in the Lloyd’s market will be asked to no longer provide new insurance cover for thermal coal-fired power plants, thermal coal mines, oil sands, or new Arctic energy exploration activities from 1 January 2022.
The target date for phasing out the renewal of existing insurance cover for these types of businesses is 1 January 2030.
“This is the first time we have set an ESG strategy for the Lloyd’s market and it represents an important milestone on the journey towards building a more sustainable future,” said Bruce Carnegie-Brown, Chairman of Lloyd’s ESG committee and Chairman of Lloyd’s.
“We have the opportunity to play our part in building back a braver, more resilient world. We recognise that the targets we are setting will be challenging, but will also bring new opportunities.
“We will work closely with our market and customers to help them plan for these changes as we implement a long-term managed programme towards sustainable, responsible underwriting.”