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Santam scoops top spots as global environmental

Santam scoops top spots as global environmental
09-12-12 / Staff Writer

Santam as JSE sustainability leader

ClimateWise is the global insurance industry’s leadership group seeking to drive action on climate change risk, facilitated by the University of Cambridge’s Programme for Sustainability Leadership.

Santam was also declared one of the top 10 performers in the JSE’s Socially Responsible Investment (SRI) Index Annual Review for 2012 demonstrating its commitment to the various index principles which include environment practices, stakeholder issues, corporate governance and reporting. Over 100 companies were assessed and 76 in total met the SRI Index criteria.

“We are proud of our solid performance and the progress we have made over the years in raising awareness on climate risk and our efforts in addressing that risk,” says Vanessa Otto-Mentz, Santam’s Head of Strategy.

Over 40 insurance companies and organisations from around the world have signed up to the ClimateWise Principles. The insurer, which participated for the third year in ClimateWise, sees this as a key global collaboration to deepen collective understanding and forward action on climate change.

ClimateWise leverages the global insurance industry’s expertise to better understand, communicate and drive action on climate risks.

Insurers are measured on how they address the following ClimateWise Principles:

  • Lead in risk analysis
  • Inform public policy making
  • Support climate awareness amongst our customers
  •  Incorporate climate change into our investment strategies
  • Reduce the environmental impact of our business
  • Report and be accountable

This year’s ClimateWise Review emphasised that it’s crucial for insurers to integrate climate risk into their core business, to promote wider industry action and to strengthen partnerships that create shared ways of managing risk.

“Responding to increasing weather related risk is a business priority for us. In our review this year we were proud to highlight our work on the Eden Study, aresearch project conducted in the Southern Cape in collaboration with the CSIR, the University of Cape Town and WWF. We found that the insurance industry, which facilitates risk sharing, with its expertise in risk assessment and management, can play a strong role to build climate-resilient communities, working together with others to address the real drivers of risk on a systemic basis, not merely rating the risk itself,” says Otto-Mentz.

Helping communities deal with the impact of weather risk and natural disasters, such as the $50 billion in damages recently caused along the US east coast by Hurricane Sandy, is part of the crucial offering the insurance industry provide to society – a speedy as possible recovery back to normality.

This year alone 11 natural disasters occurred in territories outside our borders that have cost $1 billion or more in damage, making 2012 rank second on the list of top billion-dollar disaster years. However natural disasters in 2011exerted the costliest toll in history with a massive $380 billion worth of losses from earthquakes, floods, tornadoes, and other extreme weather conditions.  Yet only a third of those costs were covered by insurance.

South Africa had its own fair share of costly “mini-catastrophes” this year with the recent Cape St Francis fire, Gauteng hailstorms in October and the floods in the Eastern Cape and Mpumalanga in January and February.

“The insurance sector continues to operate in a challenging environment and it is important for insurers to act as “global risk connectors” with the value of ecosystem resilience in mitigating disaster risk, including climate risk,” says Otto-Mentz.

It is essential for the global insurance industry to foster closer alliances to help business, society and governments find appropriate solutions to the rising weather risks. Recovering from disasters is costly, and it is not only the asset costs that should be considered, business interruption, supply chain disruption and the impact on lives and livelihoods are also of importance.

“We recognise that climate change is a collective challenge - a shared risk that requires innovative systemic risk solutions – from a market and a non-market perspective. As the country’s general insurer we are committed to continue our learning journey in this respect and to work with others to develop solutions that promote a more resilient landscape,” concludes Otto-Mentz.

2013 marks the 5th Anniversary of the ClimateWise initiative an since its establishment members have made significant progress towards understanding and responding to the risks and opportunities posed by climate change. The group continues to play a clear leadership role for the wider insurance industry.

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