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Response to EC consultation on institutional investors and asset managers’ duties regarding sustainability

Insurance Europe has responded to a European Commission consultation on institutional investors and asset managers’ duties regarding sustainability.

Insurance Europe said that, while insurers have already begun to consider and incorporate Environmental, Social and Governance (ESG) factors into their business models and investment strategies, there are several challenges and barriers to the identification, measurement and assessment of sustainability/ESG factors.

This includes the often-limited availability, quality and consistency of ESG data, which is a significant constraint. Similarly, in particular for smaller insurers, the build-up of resources and expertise can be considered as a barrier to enhanced engagement in sustainability issues.

Insurance Europe said that investing in a responsible/sustainable way is not only about investing in certain assets, but can also be translated into a strategy that can be implemented in relation to all assets. From this perspective, it is important for the industry that a clear and detailed framework, including a taxonomy for sustainable finance, and metrics to measure ESG impact, is developed at a European and international level.

Insurance Europe also called for an increased supply of appropriate assets that meet not only sustainability criteria, but also quality and security requirements. This is key to an increased involvement by large, as well as small and medium-sized, insurers in sustainable investing.

Published 1 February 2018