RESPONDING TO TOMORROW'S CHALLENGES - ALLIANZ GROUP SUSTAINABILITY REPORT 2017
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RESPONDING
TO TOMORROW'S
CHALLENGES
ALLIANZ GROUP
SUSTAINABILITY REPORT 2017
2 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
WELCOME
CONTENTS
1 Overview 2
– Allianz Group at a Glance 3
– Sustainability Performance Highlights 4
– CEO’s Perspective 5
2 Our Contribution to the United Nations
Sustainable Development Goals 7
– Embedding the SDGs 8
– Our Contribution to the SDGs 10
3 Managing sustainability 17
– Our Renewal Agenda 18
– Our Corporate Responsibility Strategy 19
– ESG Approach 20
– Climate Change Strategy 22
– Corporate Responsibility Governance 23 OUR APPROACH TO SUSTAINABILITY To meet these legal requirements, we have ground; meeting the requirements of industry
– Transparent Reporting 24 published a combined separate non-financial initiatives while engaging with diverse audiences
– Stakeholder Engagement 25 REPORTING
report alongside our 2017 annual report. around the world with our report.
The need for greater transparency among
4 Inside Allianz 27 With our sustainability reporting, we aim to meet In the end, we want to make Allianz as
business has come to the fore as society’s
Our Role as a Sustainable Insurer 28 best practice standards and guidance as set out transparent as possible and that means
expectations continue to grow. It is especially
Our Role as a Responsible Investor 34 by global initiatives such as the Global Reporting continuously improving our sustainability
important for the financial services sector, which
Our Role as a Trusted Company 43 Initiative (GRI) and UN Global Compact (UNGC). reporting. To help us achieve it, we welcome your
has a huge responsibility – and opportunity – to
Our Role as an Attractive Employer 56 On top of these, sustainability benchmarks and feedback on this report which you can provide by
support societal priorities such as the United
Our Role as a Committed ratings such as the Dow Jones Sustainability emailing us at sustainability@allianz.com.
Nations (UN) Sustainable Development Goals
Corporate Citizen 66 Index (DJSI) and CDP enable us to compare
(SDG). To maximize our positive impact, it is vital
5 About the report 75 we communicate how we are contributing and our progress and drive up our performance
Main Targets and Achievements
– 76 where we can do more. while meeting the needs and expectations of
– Key Sustainability Data 80 diverse stakeholders.
Our sustainability reporting has come to fulfill
– Climate-related Financial Disclosure 86 Equally important is our need to reach out to and
a multitude of purposes and requirements,
making it an important but challenging engage with a broad global audience about the
opportunity. The EU Directive on disclosure of way we do business – from our employees and
non-financial and diversity information by certain investors to customers and non-governmental
large undertakings and groups (2014/95/EU) organizations (NGOs). Our reporting needs to
be open and transparent about the issues that
We hope you enjoy
has introduced new rules for the disclosure of
matter to them, and presented in a way they can reading our Sustainability
non-financial information from the 2017 fiscal
year onwards. understand. As a result we strive to find the middle Report 2017.
3 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
ALLIANZ GROUP
AT A GLANCE
With over 88 million
customers worldwide,
Allianz has grown to be
one of the world’s largest Total revenues approx.
insurers, investors and
assistance providers. €126.1bn Third-party assets of
€1,448bn
This enables us to protect our
customers locally and to offer
an increasingly diverse global
portfolio of products and services
that meet both our customers’
needs and the needs of wider
society. We stand for trust
and strive for profitable and
sustainable growth that ensures In
everyone who belongs to our more
than
community benefits.
70
Allianz Group serves
countries 88mn
customers
Over
140,000
employees worldwide
4 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
SUSTAINABILITY
PERFORMANCE HIGHLIGHTS
Total of
SUSTAINABLE • 583 insurance and investment
transactions assessed for ESG risks.
• 1.21 billion Euro revenue generated
through Sustainable Solutions.
€5.6bn
INSURER
See more on
• 58 million customers in the emerging • Allianz X invested 96.6 million page 28
debt and equity investments
consumers market. U.S. Dollars in leading digital
in renewable energy
microinsurer BIMA.
RESPONSIBLE • 1 billion Euro new debt and equity
investments in renewable energy.
• Launch of systematic approach
for engagement with investee
INVESTOR 165
companies on ESG grounds. See more on
• Green bond investments of page 34
2.5 billion Euro.
Sustainable Solutions
TRUSTED • 17% cut in CO2 emissions per
employee since 2010.
• 65% of our outbound communication
was digital.
COMPANY
See more on
• 922 suppliers have signed our • 60% of business segments measuring page 43
No. 1 insurance leader of the
Vendor Code of Conduct. NPS performed significantly above
market average or achieved
loyalty leadership in their market. DJSI
ATTRACTIVE • DJSI global insurance leader
in human capital development,
• 66% favorable votes in Work Well
Index, our highest score to date.
EMPLOYER scoring 100%. See more on
• 72% highest ever score in the page 56
• 37.6% of Allianz managers Inclusive Meritocracy Index (IMIX)
are women. – our key measure of cultural change.
COMMITTED • 20 million Euro corporate giving.
• Expanded Encouraging Future
• Second Allianz World Run raised
500,000 Euro for SOS
CORPORATE Children’s Villages. See more on
Generations with the Allianz Social page 66
Innovation Fund and Allianz Future
CITIZEN Generations Award.
5 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
CEO’S PERSPECTIVE
Allianz became the highest-ranked insurer worldwide
in the Dow Jones Sustainability Index in 2017.
This achievement doesn’t just happen overnight.
Many ambitious and dedicated colleagues have
worked together over a number of years to
achieve this goal. While there are still challenges
to come, we have made great strides in recent
“I am convinced
years. We have further embedded environmental,
social and governance (ESG) criteria into our
that climate
proprietary portfolio (the money we manage
on behalf of our insurance customers), by
change and
rolling out the ESG Scoring approach across
our debt and equity investments. This allows us
economic
to make even better investment decisions that
foster sustainable markets and societies, while
instability are the
meeting long-term interests. We have also grown biggest challenges
closer to the community, having expanded our
Corporate Citizenship Program and launching for the coming
the Future Generations Award for helping
underprivileged youth. decades. We have
These steps forward have helped us to win
the trust and recognition of our employees,
no time to waste.”
customers and policymakers that enable us to be
a leader of sustainable business standards in the
financial community. Oliver Bäte
Chairman of the Board of Management,
Allianz SE
6 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
CEO’S PERSPECTIVE
72%
THREE PILLARS THAT MAKE AN IMPACT THE NEED TO INNOVATE TO FIND MY PERSONAL MOTIVATION FOR
Large, responsible companies can, and do, have SUITABLE SOLUTIONS ENGAGING IN SUSTAINABILITY
a measurable impact. We do this by focusing The how is just as important as the what. Climate change and economic instability are the score on the Inclusive
our Corporate Responsibility (CR) approach on We need to continuously innovate: market- biggest challenges we will face in the coming Meritocracy Index
three pillars: Low-Carbon Economy, ESG Business based solutions are one way in which we can go decades. We have no time to waste. It’s not a
Integration and Social Inclusion. These pillars further in promoting economic growth and social question of getting the wheels turning, but rather
support the UN Sustainable Development innovation. Just like governmental or donation- how fast we can drive the change. We will listen
Goals (SDGs), demonstrating our dedication to based programs, they can help lift people out to our stakeholders’ concerns and continue to
global sustainability.
66%
of poverty. In particular, many regions in Asia go forward. When we meet our stakeholders’
What does that mean? We take action to protect and Africa need such solutions to tackle climate expectations, we are also meeting those of
the environment and embrace the Paris Climate change risks, healthcare and other issues that our own: to work together to reach a more
Agreement. We divested €265 million from coal directly affect people’s standard of living. sustainable future. score on the Work Well Index
and applied ESG criteria to our €690 billion Our latest investment in leading microinsurance
portfolio. We also invested €5.6 billion into platform BIMA is one example of this. With just
renewable energy. a few clicks on their mobile phones, 24 million
We want to keep supporting children and youth citizens now have access to affordable insurance
through our Encouraging Future Generations and healthcare. Our investment will allow the
60%
Program, too. So far, we have distributed €250,000 company to deliver against their ambition to
through the Social Innovation Fund to five of our reach one billion customers. Digital technologies Chairman of the Board of Management,
operating entities. The SOS Children’s Villages enable faster, simpler solutions that strengthen Allianz SE
local communities. of business segments measuring
have been heartily supported by our employees NPS either performed significantly
via the 2017 Allianz World Run – with tailor-made above market average or achieved
emergency preparedness packs amounting to a loyalty market leadership
total value of €500,000.
We will not stop there, either. Our finger is on
the pulse of sustainability market standards to
identify potential challenges, listen to stakeholder
expectations, and stay ahead of trends. We
constantly monitor customer needs, regulatory
No. 1
In 2017, Allianz Group took the leading
developments and scientific advances to be position in the DJSI among all rated
involved in all important developments in this field. insurance companies, scoring 87
out of 100 points
7 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
OUR CONTRIBUTION TO
THE UNITED NATIONS
SUSTAINABLE
DEVELOPMENT
GOALS
8 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
PEOPLE, PLANET AND PROSPERITY:
EMBEDDING THE SDGS ACROSS
OUR GLOBAL BUSINESS
Since their launch, the commitments and targets In 2017, we took a step further when we analyzed, and further integrate the global goals and targets
that comprise the UN Sustainable Development in more detail, the SDGs to which we contribute into our future strategic approach. We see this
Goals (SDGs) have come to represent a global call the most. We used the recently published year’s mapping as a next logical step as we look
to action. Stakeholders in all countries to address “Business Reporting on the SDGs: An Analysis of to elaborate further on how we can contribute
some of the greatest barriers to sustainable the Goals and Targets”, which aims to provide even more by positioning the SDGs as a driver
development facing society. As the role business the first step towards uniform and comparable for the future.
must play in helping to achieve the SDGs has reporting by businesses on their contribution
While we discuss four priority SDGs, our actual
become clearer, the goals have developed into an to and impact on the SDGs. We collected input
contribution is much wider. We have tried to
increasingly important tool for making the impacts from our businesses and experts to map strategic
capture this by highlighting the links with the SDGs
of companies on society more transparent. projects, targets, policies, and disclosures against
throughout all the chapters of our report.
However, we still see room for improvement. the business indicators of the SDGs. It was a
Companies are learning and developing their challenging exercise which took several iterations
approaches as they work to translate the goals – mainly as the SDGs are so interrelated and
– which were originally intended to support dependent on each other, making prioritization
countries’ sustainable development – into tangible difficult if not, at times, impossible! The outcome
business activities. In order to develop such of our intense discussions and deliberations
approaches, we would like to see all stakeholders enabled us to identify the four SDGs to which we
– from both the private and public sector – coming believe Allianz makes a particularly significant
together to develop comprehensive strategies for contribution. On the following pages, we describe
the SDGs. the projects and activities that best illustrate the
ways we contribute to these SDGs.
As we progress on our journey, last year we carried
out our first strategic exercise to map Allianz’s key Going forward, if using the SDGs to support global
activities and targets to the SDGs. This gave us an sustainable development becomes the goal for all Katharina Latif
initial overview of the goals we broadly contribute actors, it could provide the first globally-consistent
Head of Corporate Responsibility,
to. You can find the results on page 11 of our framework for all to deliver positive change.
Allianz SE
2016 report. We are also considering how we can better align
our CR strategy with the SDGs
9 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
HOW OUR STRATEGY
ALIGNS WITH THE SDGs
The global SDGs are a universal call to action to end poverty, protect the planet and improve global “Given the nature and size of our
political and economic stability. Through 17 bold commitments and 169 targets, the goals seek to drive business, we have the opportunity
global action across social, environmental and economic development issues up until 2030. to impact many of the targets set
Each goal is interlinked and they influence each other in complex ways. Through a detailed analysis, by the SDGs. However, one of the
we have identified the four SDGs to which we currently contribute, and impact on, the most. complexities of the SDGs is their
interconnectedness. You cannot
single out one or two goals to which
you solely contribute. In addition,
our business activities and
relationships are interconnected
Low-carbon as well, which makes impact
economy measurement challenging, be it
positive or negative.”
Social
inclusion
Sabia Schwarzer
Head of Group Communications
and Corporate Responsibility,
Allianz SE
Business
integration
10 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
HOW WE CONTRIBUTE
Allianz is one of the strongest financial communities We are focused on supporting low-income
in the world. We provide employment for over customers in Asia, Africa and South America to
140,000 people. Some 88 million customers in more close the gap for people who need access to low
than 70 markets rely on our insurance products and cost financial services. Digitalization is enabling
funds for their financial wellbeing. In 2017, we paid more and more people to access insurance as we
income taxes of more than 2.9 billion Euro, thereby embrace the opportunities through our Digital by
enabling public spending in education, housing, Default strategy, implemented with our Renewal
medical care, and other vital services. Agenda 2015.
By the very nature of what we do – protecting But it’s not just through our core business that we
people and businesses against risks – we contribute to sustainable economic growth; we are
contribute to our customers’ long-term financial also focused on breaking down barriers to social
wellbeing and stabilize local economies. inclusion for a better, more productive future.
Insurance is one of the key ways by which we That is why, in 2016, we made social inclusion
limit the impacts of climate risks and compensate one of the three priorities of our Corporate
for climate-related damages. The higher the Responsibility Strategy (see page 19).
level of insurance coverage a country has, the
On the following pages, we highlight just a few of
more resilient it is to extreme natural events.
the ways Allianz contributes to the four SDGs on
Furthermore, following an extreme weather event
which we have the greatest impact.
such as a flood or hurricane, insurance payments
are often a fast and reliable solution to help
victims recover quickly, preventing them from
falling into, or deeper into, poverty.
140,000+
people are employed by Allianz worldwide
88mn
Allianz customers in over 70 markets11 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
OUR FOCUS SDGs SDG 8
Promote sustained, inclusive and
sustainable economic growth, full
and productive employment and
decent work for all.
As one of the world’s largest financial KEY TARGETS:
services providers, enabling sustainable
economic growth is fundamental to our 8.2 Achieve higher levels of economic
productivity through diversification,
core business and it provides a basis for technological upgrading and innovation,
our entire contribution to delivering the including through a focus on high-value
SDGs. We see this as the SDG to which added and labor-intensive sectors.
we contribute most, due to the nature 8.3 P romote development-oriented policies
of our role in society. that support productive activities, decent
job creation, entrepreneurship, creativity
and innovation, and encourage the
formalization and growth of micro-, small-
and medium-sized enterprises, including
through access to financial services.
8.6 B y 2020, substantially reduce the
proportion of youth not in employment,
education or training.
In this chapter, we highlight just some of the Fostering a working environment that includes
projects that contribute to SDG 8. To see more Inclusive Meritocracy: page 59.
of our contribution to this SDG, please refer to
Protecting employee rights and providing equal
the following pages:
opportunities: page 63.
Integrating ESG into investments and insurance:
Supporting workplace health and wellbeing
page 20.
through Work Well: page 65.
Sustainable and Responsible Investments:
Managing our environmental impacts to
page 36.
decouple economic growth from environmental
Protecting human rights and eliminating degradation: page 53.
modern slavery in our supply chain: page 55.
Promoting access to financial solutions for
emerging consumers: page 32.12 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
OUR FOCUS SDGs
SDG 1 SDG 7 SDG 13
End poverty Ensure access to Take urgent action to
in all its forms affordable, reliable, combat climate change
everywhere. sustainable and and its impacts.
modern energy for all.
Key targets: Key targets: Key targets:
1.1 By 2030, eradicate extreme poverty for all people 7.1 B y 2030, ensure universal access to affordable, reliable 13.1 S trengthen resilience and adaptive capacity to climate-
everywhere, currently measured as people living on and modern energy services. related hazards and natural disasters in all countries.
less than $1.25 per day.
7.2 B y 2030, increase substantially the share of renewable 13.2 Integrate climate change measures into national policies,
1.2 By 2030, reduce at least by half the proportion of men, energy in the global energy mix. strategies and planning.
women and children of all ages living in poverty in all
its dimensions according to national definitions. 7.3 In 2030, double the global rate of improvement 13.3 Improve education, awareness-raising and human and
in energy efficiency. institutional capacity on climate change mitigation,
1.5 B y 2030, build the resilience of the poor and those in adaptation, impact reduction and early warning.
vulnerable situations and reduce their exposure and
vulnerability to climate-related extreme events and other
economic, social and environmental shocks and disasters.
SDG 1 aims to increase access to social Energy is a fundamental ingredient for delivering Climate change poses a major risk to the livelihoods
protection, basic services and support for people almost all of the SDGs, but it is also a major contributor of millions of people worldwide, and acute weather-
harmed by climate-related and other economic, to climate change. The focus must be on increasing the related risks seen in 2017 include hurricanes, droughts,
social and environmental shocks and disasters. share of sustainable energy and driving improvements floods and wild fires. We anticipate the risks of climate
Increasing universal access to financial services, in energy efficiency. change as an investor, and we protect and care for our
including microinsurance, saving and equity is key to customers through our insurance products, while using
eradicating poverty – especially among emerging our assets and insurance expertise to enable the
consumers in low-income countries. transition to a low-carbon economy.13 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
OUR CONTRIBUTION TO THE SDGs
KEY peers through the Insurance Development KEY consumer segment. To make the most of the
TARGETS: Forum to pilot insurance approaches that TARGETS: opportunities, we partner with digital businesses
1.5 13.1 allow governments in countries vulnerable to 1.1 1.2 to distribute and expand our reach, for example
climate change to provide better shelter to their through mobile phone-based insurance
13.3 population. We are also participating in the 1.3 solutions. In 2017, Allianz became the largest
Munich Climate Insurance Initiative to make strategic shareholder of BIMA, the leading digital
PROTECTING THE MOST VULNERABLE more microinsurance solutions market-ready for INCREASING ACCESS TO FINANCIAL microinsurer whose award-winning tech platform
Caribbean countries. Furthermore, through our SERVICES IN LOW-INCOME COUNTRIES provides low-income families with access to
We actively support the InsuResilience initiative partnership with the German Corporation for innovative insurance products in 14 emerging
of the G7, which aims to provide climate risk International Cooperation (GIZ), we are setting We have more than 58 million customers in markets worldwide.
insurance to additional 400 million vulnerable up a program that aims to reduce flood risk for emerging markets, but many customers in
people by 2020. As a responsible corporate municipalities in Ghana and for small and medium these countries are still severely underinsured, Find out more
citizen, we are involved in several initiatives to enterprises in Morocco. as well as underserved in other areas such on page 32
share our expertise and help manage climate as savings, investments and health services.
risks. For example, we are working with our
14
Find out more Since traditional financial services infrastructure
on page 33
is not established in many markets, digitalization
offers a major opportunity for our emerging
emerging markets now have access to insurance
products thanks to BIMA14 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
OUR CONTRIBUTION TO THE SDGs
KEY our experience as a microinsurer and reinsurer KEY Future Generations Award aims to empower
TARGETS: in agriculture to bring climate risk insurance TARGETS: entrepreneurs who want their businesses to deliver
1.5 13.1 mechanisms to vulnerable regions. Our solutions
compensate farmers for lost proceeds from crops
8.6 1.1 a societal impact on future generations, by giving
them a chance to learn about developing and
13.3 or livestock, and recover financial losses caused attracting investment. In addition, our global
by natural hazards, enabling them to respond partnership with SOS Children’s Villages is focused
IMPROVING FOOD SECURITY RESILIENCE quickly and build resilience to climate change ENCOURAGING FUTURE GENERATIONS on supporting young people to build resilient
impacts. For example, we are working on a future generations. We also support a range of
To provide for the growing population, global food new crop insurance approach that uses remote Social inclusion is one of the most important other initiatives, including My Finance Coach, a
production will have to double in the next fifty sensing technologies. challenges society is facing. To amplify our non-profit initiative that aims to improve financial
years. However, the impacts of climate change on contribution, we launched Encouraging Future literacy among 10 to 16 year-olds.
agriculture are far-reaching and complex. In some Find out more Generations – our social inclusion approach
places, warmer temperatures and growing page 33 that targets better opportunities for young Find out more
seasons may be a benefit. In others, the increasing people worldwide. Our Social Innovation Fund on page 68
risks of drought and extreme weather will have provides incentives for operating entities to
devastating consequences. We are building on enhance their reach to youth, while the Allianz15 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
OUR CONTRIBUTION TO THE SDGs
KEY
TARGETS:
1.5 7.1 7.2
7.3 8.3 13.3
INVESTING IN THE LOW-CARBON
ECONOMY
We are committed to supporting the transition to
the low-carbon economy by using our leverage
as one of the world’s largest institutional investors.
We focus the climate-related investments of our
proprietary assets on energy-efficient real estate,
renewable energy projects, funds and green
bonds, reducing climate emissions and creating
sustainable economic growth. Additionally,
Allianz offers several renewable energy funds
for institutional investors who want to invest in
low-carbon infrastructure.
We also invest in low-carbon projects and
initiatives which generate certificates that
we use to offset our carbon footprint. One of
our continued investments is in Rimba Raya.
We began investing in this REDD project in
Borneo, Indonesia, in 2013, helping to prevent
rainforest deforestation and avoiding CO2-
release. Our investments in Kenya, the Democratic
Republic of Congo and Indonesia not only help
us to offset our carbon footprint, but also
contribute to protecting biodiversity and
support local communities.
Find out more
on page 5416 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
OUR CONTRIBUTION TO THE SDGs
KEY Management Strategy. This operational global KEY their transition to the low-carbon economy.
TARGETS: incident management system is designed to TARGETS: Group experts from Allianz Climate Solutions and
1.5 13.1 improve preparedness and response operations
across SOS Children’s Villages. Using satellite-
8.6 1.1 Allianz Re work with local entities to develop best
practice and increase local capacity. A dedicated
13.3 based early warning and damage mapping underwriting framework, pricing tools, and a
services, data, early warnings, incident reports robust referral process have been created to
IMPROVING DISASTER RESILIENCE and emergency maps are linked to an online INSURING THE LOW-CARBON ECONOMY support local business growth. In addition, a
AND RESPONSE emergency management platform named Renewable Energy Desk connects local entities
Resilience360 (R360). This platform was As the low-carbon economy expands, the global with expert account managers at group-level.
Our global partnership with SOS Children’s originally developed by DHL, and SOS-CVI is energy system is changing rapidly, bringing with
Villages International (SOS-CVI) includes it complex challenges. Renewables are gaining a In Turkey, new products already rolled out include
the first global humanitarian organisation to
turning facilities into safe disaster hubs for local meaningful market share in many countries and a performance guarantee and comprehensive
implement it. R360 sets a milestone with regard
communities in the event of a catastrophe building and operating renewable energy plants certification services for solar and wind projects
to translating early warning into early action. It is
through customized Emergency Preparedness involves multiple stakeholders and poses different over 20 megawatts.
now being rolled out to national and regional
(EPREP) packages. In 2017, we launched SOS-CVI offices. risks at the different stages. In Africa, we are working with the GIZ and the
and funded the global SOS Disaster Risk Launched in 2017, the initiative SURE (Scaling German Federal Ministry for Economic Affairs
Find out more Up Renewable Energy) aims to further solidify and Energy to bring German renewable energy
on page 69
Allianz’s position as the global “go-to” provider solutions to African markets. Roll-out has begun
of insurance for renewable energy projects and in Nigeria, Ghana, Kenya, and Morocco where
infrastructure. It is designed to help bring our we have dedicated local renewable energy
proven renewable energy insurance competences champions in place to adapt standard products
at group-level to fast developing growth markets and services to meet local needs.
– such as Turkey, Australia, and Africa – to support
Find out more
on page 3317 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
MANAGING
SUSTAINABILITY
Number 1 insurer in the Dow
Jones Sustainability Index
87/100
Allianz scored 87 out of 100
points on the DJSI
The Dow Jones Sustainability
Index (DJSI) ranks companies
according to environmental,
social and governance (ESG)
criteria, assessing their strategy “We are extremely proud of this result.
and performance. We started with the integration of ESG
factors into our business early on and
In 2017, Allianz took the leading have continuously improved. We also set
position of the insurance sector, ambitious goals for the coming years and
scoring 87 out of 100 points. would like to contribute to the achievement
of the Sustainable Development Goals.”
Oliver Bäte
Chairman of the Board of Management,
Allianz SE18 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
OUR RENEWAL
AGENDA
OUR STRATEGY AND APPROACH what we want to achieve and how we will work
together to deliver our goals across five key
The Allianz Group seeks to position itself as one areas. Our Corporate Responsibility Strategy
of the world’s most trusted financial services supports the business in delivering the company's
provider and a global sustainability leader. goals in a way that positions us as one of the most
That means creating sustainable economic responsible insurance and investment
value through a long-term approach to businesses in the world.
corporate governance, social responsibility and
environmental stewardship. In 2017, we continued to develop and implement
our strategic approach, building on the five
We want our stakeholders to know that Allianz is pillars of our success – integrity, financial strength,
a financially solid and trustworthy company that technical competence, operational excellence
embraces sustainable business as good business, and talent base.
and whose heart beats for its customers and
its employees. To achieve this, we are adapting
our business strategy with the Renewal Agenda.
It drives our company forward by setting out
TARGETS
OUR RENEWAL AGENDA
To deliver our Renewal Agenda, we have set clear targets for 2018:
Five mutually reinforcing levers…
Annual Earnings per Share Total Return on
TRUE CUSTOMER Make superior customer experience the top priority for all (EPS) growth of Equity (RoE1) of At least
5% 13% 75%
CENTRICITY our actions.
DIGITAL BY Move from selected leading assets to become ‘Digital by
on average from of our businesses to be
DEFAULT Default’ everywhere. 2016 to 2018 rated by their customers as
Loyalty Leader in terms of
Net Promoter Score
TECHNICAL Create superior margins, innovation, and growth through
EXCELLENCE best talents and state-of-the-art skills.
Increase our Inclusive
GROWTH Systematically exploit new sources for profitable growth. Meritocracy Index (IMIX) to
ENGINES
INCLUSIVE Reinforce a culture where both people and performance matter.
72% 100%
Share of newly launched
MERITOCRACY digital products
1
Excluding unrealized gains/losses on bonds, net of shadow accounting.19 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
OUR CORPORATE
RESPONSIBILITY STRATEGY
Our Corporate Responsibility MATERIALITY
Strategy ensures we manage In 2016, we re-assessed our material issues and
refocused our strategy (see page 7–9 of our
our sustainability-related Group Sustainability Report 2016). The perceived
risks and opportunities. It most important megatrends and risks that
Allianz is able to address through its solutions
drives performance across the and Corporate Responsibility Strategy are, in
sustainability issues that are particular: climate change and environmental
most important to our business issues, such as natural catastrophes; personal
customer safety, including data security risks; and
strategy and our stakeholders. societal issues, such as safety and human rights.
We are working to better align We organize our strategy around three focus
areas, through which we respond to our material
our Corporate Responsibility issues (the issues that are perceived as vital
Strategy with our Renewal for business success and sustainability by our
OUR FOCUS AREAS
stakeholders – see across). These three focus
Agenda and on ensuring CR areas shape what we deliver through the five
implementation throughout key roles we play in society.
the group. Low-carbon Social Business
economy inclusion integration
Using our roles as an Insurer Using our roles as an Insurer, Managing material ESG risks
and Investor to help manage Employer and Committed and seizing ESG opportunities,
the risks arising from climate Corporate Citizen to contribute while embedding compliance,
change and to promote the to more inclusive societies. responsible sales, transparency
low-carbon economy. as well as data protection and
Encouraging Future
privacy across all areas of
Our Climate Change Strategy Generations is our new social
our business.
lies at the heart of our business inclusion program that is
model that aims to protect promoting inclusion of young Our global ESG Framework
people and businesses people worldwide. ensures ESG integration in all
from risk. our insurance business and
investments of proprietary
assets.
For more information For more information For more information
see page 22 see page 68 see page 2120 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
ESG APPROACH
We aim to lead our industry on integrating ESG OUR INTEGRATION APPROACHES AND PROCESSES ESG PROCESSES ACROSS ALLIANZ BUSINESS LINES
into our insurance and investment businesses
as part of our everyday decision-making. For property and casualty underwriting (P&C) and unlisted Investment
We have developed multiple instruments investments we systematically integrate ESG through our ESG
ESG Processes Insurance Listed Non-Listed
that allow us to integrate ESG concerns in our referral process and guidelines for sensitive business areas.
underwriting, investment and asset management activities. Each transaction is screened at the local level to identify ESG Referral Process
All our ESG integration activities are implemented through potential ESG concerns. When a risk is identified, the local entity
refers the risk to the appropriate group-level ESG function, ESG Sensitive Business Guidelines
group-wide corporate rules on risk management, underwriting
and investment. which assesses the ESG risk in more detail. Sensitive Countries List
In 2017, we ran a consultation with our local and global In 2017, our ESG functions conducted 583 ESG assessments
ESG Scoring Approach
operating entities to better understand how we can continue based on the guidelines (2016: 508 assessments). In 44.9% of
to improve the ESG screening processes. As a result, the next cases, the assessment led to a transaction being approved. Engagement and Dialogue2
generation of ESG guidelines enters into force in 2018. 48.4% were approved following certain mitigation measures or
conditions being put in place, and 6.7% were declined on ESG ESG Exclusion Policies
grounds or not pursued by the business (see details on page 84). Asset Manager Mandating, Selection and Review
2
Included investment engagement as an asset owner as well as insurance-based risk dialogues.
What is ESG OUR ESG REFERRAL PROCESS
Environmental, social and governance (ESG)
topics are extra-financial factors which can be Sensitive
Planned No further
influenced by, and can influence, our business insurance/ business action
Business sectors/
activities. Examples of ESG risks include human investment unit screens required
rights violations, illegal logging activities or transaction countries No for ESG
apply?
severe corruption allegations. ESG factors
also present opportunities such as increased Yes ESG
requirements for renewable energy due to the No approval
energy transition.
ESG risks can develop into legal risks, Business unit Yes ESG
Referral to conditionally
applies relevant
reputational risks, supply chain and business ESG Sensitive Potential appropriate approved subject to
disruption risks, quality risks, operational ESG center of ESG further information
Business ESG risk Assessment or mitigation
risks, human rights risks, financial risks, and/ detected? competence
Guideline measures
or investment risks for Allianz, its customers
and/or its invested companies. We therefore
manage these risks diligently through
Declined for
various instruments. ESG reasons21 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
ESG APPROACH
Allianz ESG Scoring approach
For ESG integration in listed
assets, we rolled out the ESG
Scoring approach across all
proprietary portfolios in 2017.
The approach enables us to
better manage ESG risks and
opportunities in our proprietary
portfolio. It expands the
coverage of our ESG framework
and allows us to systematically
integrate ESG across all our
asset classes (see page 36).
In 2017, we developed a systematic approach Additionally, our asset managers, Allianz Global
to drive engagement with selected investee Investors (AllianzGI) and the Pacific Investment
companies that have a low ESG performance. Management Company (PIMCO), have continued
Through collaboration, we address material ESG to expand their ESG capabilities and product
risks and concerns, build understanding and offerings for third-party clients throughout 2017.
ultimately drive change and ESG improvements. For additional details see our section on ESG in
asset management on pages 36–38.
Other tools we use to integrate ESG into
our investment processes include: ESG We published the second edition of the Allianz ESG
investment exclusions; asset manager selection Integration Framework, which further increases
and monitoring with ESG criteria in mind; transparency around our internal processes
sustainability-themed investments such as and guidelines related to our ESG approach.
renewable energy, green real estate, and green The updated version provides additional details
bonds; and regular dialogue and exchange on the ESG scoring approach and our approach
with peers, regulators and internationally- to capturing ESG opportunities.
recognized NGOs.
Please find further information on the
Allianz ESG Integration Framework here.22 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
CLIMATE CHANGE STRATEGY
We are committed to taking PROMOTING CLIMATE CHANGE
a leading role in tackling the TRANSPARENCY: THE TASK FORCE
climate challenge. This means ON CLIMATE-RELATED FINANCIAL
managing emissions from DISCLOSURES (TCFD)
our operations, as a carbon- We strongly believe that, for customers and
neutral company, and using our investors to be able to make informed decisions,
companies must report comprehensively on how
leverage as one of the world’s they tackle dominant global long-term trends,
largest institutional investors such as climate change. We’ve advocated for
greater transparency and reporting on climate
and insurers. change risks by companies for a number of
years. As such, we strongly support the 2017
Allianz Group has had a Climate recommendations of the TCFD, which aim to
Change Strategy in place provide guidelines for consistent disclosure
since 2005. of climate-related risks and opportunities by
companies to give meaningful information to
The strategy aims to encourage solutions for their stakeholders.
tomorrow’s climate:
In June 2017, Oliver Bäte, along with other CEOs
1. We anticipate the risks of a changing climate of leading companies, signed the Statement of
for our business. Support for the TCFD Recommendations and
2. We care for the climate-vulnerable. called for an improved disclosure across sectors
and regions. We report on climate-related
3. We enable the low-carbon transition. risks and opportunities based on the TCFD-
The identification and management of risks and framework and our disclosure can be found on
opportunities resulting from climate change are page 86–89.
part of our overall business strategy. Measures we We are encouraging other companies –
take include developing and adjusting financial within our sector and beyond – to step up
products and services, improving decision-making, and improve their disclosure. We do this, for
policies and processes, setting targets, managing example, through our memberships in the
our operational climate footprint, and engaging B-Team, the World Economic Forum Alliance
with internal and external stakeholders. of CEO Climate Leaders, the UNEP FI, and the
Our strategy is regularly updated and will be Portfolio Decarbonization Coalition. Our other
aligned with the recommendations developed by efforts include working with the European
the G20 Financial Stability Board’s Task Force on Bank for Reconstruction and Development to
Climate-related Financial Disclosures (TCFD). bring forward the strategic assessment and
management of climate risks and opportunities.23 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
CORPORATE RESPONSIBILITY
GOVERNANCE
Strong corporate governance Dr. Günther Thallinger
Member of the Board of Management of Allianz CR GOVERNANCE STRUCTURE
is pivotal to our sustainability SE since 1 January 2017 with responsibility for
approach and is one of our Investment Management; member of the Group
Corporate Responsibility
ESG Board since 1 January 2017; Chair of the
most important material issues. Group ESG Board as of 1 January 2018. department
Established in 2012, the Group ESG Board is Jacqueline Hunt
the highest governing body for sustainability- Member of the Board of Management of
related issues. It consists of three Allianz SE Allianz SE since July 2016, responsible for Asset
Board members and several department heads. Board-level Group-level functional Global lines and
Management and US Life Insurance; member of
They meet quarterly and are responsible for the Group ESG Board since 1 July 2016. committees departments local entities
ensuring ESG integration across all business lines
and core processes dealing with insurance and Giulio Terzariol
investment decisions. Key topics of focus in 2017 Member of the Board of Management as Examples: Examples: Examples:
included implementation of the recommendations of 1 January 2018, with responsibility for the Group ESG Board Risk management, Compliance, Global Lines:
of the TCFD (see pages 22 and 86–89) and Finance, Controlling and Risk Management Group Finance and Risk Committee Investor Relations, HR, Allanz Global Investors, PIMCO,
development of a more systematic approach to functions; member of the Group ESG Board as of Allianz Global Corporate
Group Underwriting Committee Investment Management, & Speciality, Euler Hermes
investor engagement (see page 38). 1 January 2018.
Procurement, Local operating entities:
Functional leads that are part of the Group ESG Communication e.g. Allianz Seguros (Brazil), Allianz
The Group ESG Board also takes ownership of
Board include representatives from: Head of Turkey, Allianz Germany
corporate responsibility and climate-related
Corporate Responsibility; Head of Communications;
topics, and leads on associated stakeholder
Head of Risk; Head of Compliance; CFO Allianz
engagement. Functional departments provide
Investment Management SE; CEO AGCS3 (as of
regular updates on sustainability issues directly to
January 2018), Head of Emerging Trends and
the Group ESG Board.
ESG, AGCS; and Managing Director ACS4 (until CORPORATE RESPONSIBILITY The Head of Group Communications and
31 December 2017). MANAGEMENT Corporate Responsibility, reports directly to the
THE GROUP ESG BOARD CONSISTS OF: CEO of Allianz SE. This ensures a close alignment
In addition to the Group ESG Board, several The Corporate Responsibility department is with the CEO’s agenda.
Dr. Axel Theis Member of the Board of
committees play an important role in our decision- responsible for the strategic framework that drives
Management of Allianz SE since 2015 with Allianz Climate Solutions – our center of
making processes: all group-wide sustainability activities. Its scope
responsibility for Global Insurance Lines and excellence for climate change, with a focus
Anglo Markets; member of the Group ESG Board Group Finance and Risk Committee: oversees includes managing CR governance and fulfilling
external reporting and rating requirements. on renewable energy, and responsible for the
from 1 January 2015 to 31 December 2017; risk management and monitoring, including
The team also supports operating entities implementation of the Allianz Climate Change
Chair of the ESG Board from 1 July 2016 until sustainability risk. The Committee is the escalation
to effectively integrate the Group’s strategic Strategy – sits with Allianz Re alongside the Group
31 December 2017. point for ESG-related topics, based on analysis
sustainability approach and policies into their Environment Office.
and deliberations within the Group ESG Board.
business processes.
Group Underwriting Committee: monitors the You can find out more about
Allianz Climate Solutions here.
underwriting business and its risk management,
as well as developing new underwriting policies
and strategy.
3
Allianz Global Corporate and Specialty.
4
Allianz Climate Solutions.24 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
TRANSPARENT REPORTING
“Non-financial reporting has
REPORTING DATA AND ASSURANCE Carbon Disclosure Project (CDP) come to fulfill a multitude
Our Strategy shapes and increases our To enhance the quality of our sustainability Allianz Group supports the CDP as a responding of purposes, making it a
contribution towards delivering the SDGs (see reporting and data, our full sustainability report company and as an asset owner and asset challenging opportunity.
page 9). It also reaffirms our commitments to has been assured to a limited assurance-level manager. We were also a founding signatory of
the Principles of the UNGC, a voluntary initiative by PwC since reporting year 2016. This helps to the CDP. Allianz has been listed in the Carbon
Auditing non-financial data and
based on CEO commitments to implement 10 formalize the way sustainability is embedded Disclosure Leadership Index from 2011 to 2015. processes helps us to further
universal sustainability principles in the fields of across core functions and business units. A sample In 2017 we achieved a B rating. embed sustainability across
human rights, labor standards, environmental of operating entities of Allianz SE are reviewed
FTSE4Good Index
the organization.”
protection and anti-corruption. We have been by PwC on a regular basis depending on their
a participant in the UNGC since 2002 and it is impact on the Group’s sustainability activities. Included since 2001, Allianz is one of the
included in our Code of Conduct. longstanding members of the FTSE4Good Index
We base our approach and reporting on You can find the current assurance report here. series. In the 2017 assessment, we were ranked in
voluntary international standards and guidelines the top 3% of our sector.
such as the GRI G4 guidelines, sustainability RATINGS AND BENCHMARKS MSCI Rating
indices, and engagement with expert working
As we strive to be a sustainability leader
groups such as the United Nations Environment In 2017, Allianz once again received AAA rating
in our sector, sustainability ratings and
Programme Finance Initiative (UNEP FI). from MSCI ESG Research. We are one of the top
industry benchmarks provide an important
performers in our sector.
Our annual UNGC communication on progress opportunity to improve our performance and
and the German Sustainability Code (GSC) transparency. We also rely on these ratings to Oekom Corporate Rating
reports can be found on our website, as well as support long-term ESG integration across our Dr. Saskia Juretzek
on the UNGC and GSC websites. proprietary investments and the responsible Allianz has once again received Prime status
in 2017, which ranks us among the world’s best Senior Manager Sustainability,
investment products offered to our asset Allianz SE
In compliance with the 2017 German companies in our industry.
management customers.
implementation of the EU Non-Financial
Reporting Directive (2014/95/EU), we published We take part in a wide range of external
a combined separate non-financial report assessment and benchmarking initiatives,
alongside the Group Annual Report 2017. including:
The combined separate non-financial report
is being audited by PricewaterhouseCoopers Dow Jones Sustainability Index (DJSI)
GmbH Wirtschaftsprüfungsgesellschaft (PwC) Allianz has been included in the DJSI since 2000.
and is to be approved by the Supervisory Board In 2017, Allianz Group took the leading position
of Allianz SE. within the insurance sector, scoring 87 out of 100
points. We have been included in the DJSI with
You can find our combined separate top ranking positions every year since 2000.
non-financial report here.25 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
STAKEHOLDER ENGAGEMENT
OVERVIEW PARTNERSHIPS FOR CIVIC OUR KEY STAKEHOLDER GROUPS
As the global economy continues to evolve, the ENGAGEMENT
challenges we face as a multinational business Our long-term partnerships are
are diverse and complex. To respond effectively instrumental to delivering our
through our strategy, we need to understand sustainability agenda.
global trends and how they will impact on us. Investors Customers
We also need to understand stakeholder needs Our strategic partners include: We engage with our investors to Feedback from our customers helps us to
communicate our sustainability strategy and improve our products, services and processes, and
and concerns so that they can inform our products, SOS Children’s Villages (see page 69) performance, enabling them to make informed to offer easy and adaptable solutions.
services and approach. decisions about their own investments and us to • Customer surveys and dialogues
Impact Hub collaboration (see page 71) understand their expectations.
To do this, we engage with a broad range of • Learning from and sharing customer insights
German Corporation for International • Annual General Meeting
individuals and organizations. The insight they • Review of financial services sector
Cooperation (GIZ) • Dialogues and roadshows developments
provide enables us to focus our Corporate
• Ratings and benchmarks • Research and development to support product
Responsibility Strategy, activities and reporting International Paralympic Committee (IPC) innovations
• Website, Sustainability Report,
on the right areas. rating results e.g. DJSI • Using the Net Promoter Score (NPS)
• Allianz Risk Barometer Survey
Besides our many commitments to international
and national sustainability bodies and initiatives,
our engagement activities focus on the four
stakeholder groups who are most impacted
by our business.
MEMBERSHIPS AND PARTNERSHIPS Society Employees
Given the pace and scale of global We believe employees who are
Our businesses are signatories to and members of a wide range of global sustainability initiatives change, it is vital we work with other partners, engaged with and committed to their jobs
and principles, which guide us to: governments and institutions to identify sustainable generate long-term value for our business. To this
solutions and maximize our positive impact. end, we continuously seek their views and respond
• incorporate best practice sustainable development principles into our activities, products, • Partnerships for civic engagement to their ideas and concerns through:
services and investments; • Thought leadership on global issues • The Allianz Engagement Survey (AES)
• work with and learn from our peers through open dialogue and knowledge sharing; • Panel discussions and roundtables
• Employee dialogues and networks
• Foundations, donations and volunteering
• collaborate to find solutions that address local and global challenges relevant to our industry • Press events, journalist surveys • Corporate volunteering programs
and beyond; and and roundtables
• Formal dialogues with NGOs
• improve transparency in our own operations and across the value chain. and ESG professionals
For an excerpt of our memberships and partnerships, please refer to page 79.26 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
LOOKING
AHEAD
“We integrate Environmental,
Social, and Governance (ESG)
principles throughout our
investment and insurance
business by holding business
decisions up to the light and
asking ourselves, ‘Will this
benefit society and our
customers in the long term?”
Oliver Bäte
Chairman of the Board of Management, We will further align We will continue to embed our Corporate
Responsibility Strategy and focus areas across
On 1 January 2018, the Group’s Environment
Office, as well as the experts for integrating
Allianz SE the Renewal Agenda all our businesses and countries to support climate change into the business, will become part
and our Corporate consistent integration and reporting. of the Corporate Responsibility department.
Responsibility Strategy. We will further enhance data quality
through external assurance and improved
management approaches.27 Allianz Sustainability Report 2017 Overview SDG contributions Managing sustainability Inside Allianz About the report
INSIDE ALLIANZ
This section translates our work
into five roles we play in society.
In order to be considered a Responsible Investor,
we will continue to integrate ESG criteria across
Our role as a
our investment decisions. As a Sustainable Sustainable
Insurer, we need to continue to provide solutions
that support sustainable development and a low- Insurer
carbon future.
Our role as an Attractive Employer is of very Page 28
high relevance as we depend on having the best
people in place, and keeping them motivated
to serve our customers.
Our role as a Our role as a
Data and privacy protection, improving Committed Responsible
customer satisfaction and reducing our
environmental impact all play a major part
Corporate Citizen Investor
in being a Trusted Company.
We act as a Committed Corporate Citizen to
Page 66 Page 34
maximize our positive contribution and to create
a more stable economy and resilient markets.
Our role as an Our role as a
Attractive Trusted
Employer Company
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