Argo Group won corporate social responsibility initiative of the year in the InsuranceERM UK & Europe 2021 awards. Alex Hindson, chief risk and sustainability officer at the Bermudian insurer, tells Ronan McCaughey how CSR is benefitting the business
Corporate social responsibility (CSR) is a new InsuranceERM award category this year highlighting insurers' growing recognition of environmental, social, and governance (ESG) factors in their business activities, and recognising that failure to make measurable progress on ESG represents a reputational risk.
Argo Group won this category for developing a robust ESG strategy, which includes addressing issues such as diversity and inclusion (D&I), publishing a greenhouse gases inventory and gauging employee well-being during the Covid-19 pandemic.
First, the Bermudian insurer established a committee to further the D&I agenda across the company, followed by a series of employee resource groups to help take action. The board was supportive and approved a D&I policy and appointed a D&I committee chairperson.
It also addressed the issue of inter-racial tensions with a series of town hall meetings with external speakers, and partnered with the Spencer Educational Foundation to create the Argo Group Diversity Scholarship. The scholarship aims to promote diversity in the risk management and insurance professions.
Second, Argo Group published its first annual ESG report in 2020 and made its ClimateWise report public, establishing the company's first TCFD-compliant disclosure.
Third, the insurer calculated and disclosed its greenhouse gas (GHG) emissions across its 35 global offices for the first time. As a result, it was able to set GHG reduction targets for 2021.
Following its board's approval, the insurer also signed up to the UN Principles for Responsible Investment (PRI).
The award's judges commended Argo Group's commitment to its staff's well-being during the Covid-19 pandemic. For example, the insurer conducted an employee engagement survey in May 2020 to gauge the impact of remote working.
Argo Group's executive team has also been very committed to staff engagement, with regular group-wide general forums and by providing extensive support for mental health.
As part of the CSR initiative, Argo Group also created a dashboard of key risk indicators and objectives, which is approved for implementation this year.
Alex Hindson, chief risk and sustainability officer at Argo Group, says: "We will be reporting on those key performance indicators quarterly. Top of the list is to continue improving our external ESG ratings."
Hindson says the insurer's CSR initiative faced many challenges. "We started with a number of stakeholders unhappy about our ESG performance. It was a challenging place to start, but it also gave us a huge impetus and focus to drive improvement."
Asked if the CSR initiatives are improving enterprise risk management (ERM), Hindson says Argo Group's ESG programme is closely aligned to its ERM programme. This is simply because its ESG priorities have been "driven from the beginning by a reputational risk assessment" and evaluating the principal ESG threats and opportunities.
He says: "Giving clarity of our threats and opportunities to our Sustainability Working Group, and hence [to] the board risk committee, allows us to make informed decisions."
According to Hindson, Argo Group sees the strongest link between its ESG programme and positive outcomes in the area of diversity and inclusion (D&I).
"There is strong research to suggest that inclusion is critical. Having a sense of belonging and being valued is very empowering," he comments.
For example, Hindson cites the level of take-up by staff within the insurer's employee resource groups as extremely encouraging and humbling.
"This has released a lot of energy. We certainly hope that this will help us both attract and retain talent in the future. We have also invested in looking after the welfare of our staff during the Covid-19 pandemic, and in preparing to go back better."