Insurance sector looks inward on climate, governance issues

Brokers and insurers have long focused on helping companies mitigate climate risks, but managing a broad spectrum of environmental, social and governance concerns is becoming a critical part of how the industry does business.

Employees, policyholders, investors and ratings agencies, in addition to climate activists, are increasingly scrutinizing how businesses, including brokers and insurers, address a range of ESG-related issues, including environmental stewardship, climate change, diversity and inclusion, racial justice and workplace conduct, experts say. 

In June, an activist investor forced the board of Exxon Mobil Corp. to elect “climate-aware” director candidates, and in May a court in the Netherlands ordered Royal Dutch Shell PLC to reduce carbon dioxide emissions by 45% of 2019 levels by 2030. Also in June, Legal & General Investment Management, Britain’s biggest asset manager, dropped American International Group Inc. and three other companies from several of its funds over what it called “insufficient” response to

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