The Lagos Business School Sustainability Centre led the convening of the 2023 Chief Executive Forum on Sustainability Business themed 'Leveraging ESG Governance and Priorities in the Insurance Sector.’ It is a high-level knowledge sharing platform for business leaders to learn and deliberate on sector-specific sustainability issues, and this year’s spotlight was on the insurance services sector. The event took place on Thursday, November 2, 2023, at the prestigious Lagos Oriental Hotel in Victoria Island, Lagos.
In his opening remarks the Dean, Lagos Business School, Prof Chris Ogbechie, welcomed the C-suites and laid out the forum road map and objectives. He implored the insurers to see Sustainability and ESG as an opportunity and not a cost item, calling on them to leverage the insights and best case practises the forum will provide. He added that the “Lagos Business School, through the LBS Sustainability Centre, is committed to supporting the private sector in their sustainability journey and the Chief Executive Forum serves as a platform to extend this support to the insurance sector, fostering collaboration and knowledge sharing among industry leaders”.
The keynote presentation titled ‘Opportunities for Growth in ESG Finance and Risk Management’ was delivered by Mrs Tomi Adepoju, Partner and Head, Enterprise Risk and ESG Service, KPMG West Africa. She pointed out the unique opportunities for growth in market share, sales volume and profitability for insurers if they understand and mainstream Environmental, Social, and Governance (ESG) principles in their business strategy. She highlighted business cases across the globe which have become success stories of insurers leveraging creativity and innovation in the design of their policies, premiums, and products, adding that incentivising policy holders to make green choices helps to curb risks that hold great danger to the environment and the society.
She said, “when we craft our ESG strategies as insurers, we need to embed ESG into our corporate strategy and then retool our business models to ensure it is ESG focused. How do we ensure we have strong governance via diversity in boards and management. How do we embed risk management within our risk management framework? We need to look at product innovation to optimise ESG into our products and services to encourage risk reduction for policyholders. We can do this through gamification, apps and data, so policyholders are incentivised to make green choices and pay lower premiums.”
She also indicated that “countries are reducing carbon footprint, Lagos State just bought Electric Vehicle (EV) buses, do we have insurance for EVs, how do our insurance products take advantage of these market changes driven by Sustainability? “For example, AXA Pay As You Drive offers a 10 percent discount if you do less than 10k km yearly, and increases to 15% if you do less than 5km yearly.” This is to reduce carbon footprint, highlighting that under responsible investments they got 1.3 billion dollars for green businesses in 2023. She submitted that insurers in Nigeria need to invest in green initiatives and ensure they are walking the talk as it relates to ESG with an ESG road map for their organisations.
Roundtable discussions by the C-Suite insurers ensued focusing on key areas that are crucial for the insurance sector's sustainable growth and impact by leveraging ESG principles. Good will remarks were also delivered by the Chief Operating Officer (COO), United Nations Global Compact (UNGC) Nigeria office, Mrs Tumi Onamade who pointed out that Africa is not the largest contributor to climate change, however, insurers should engage with UNGC for better adaptation measures to curb ESG risks by leveraging the UNGC’s principles to better position themselves to access opportunities that abound in the ESG space, while moving the ESG mandate forward.
Overall, the C-suite insurers were able to explore the implications of climate risk on insurance businesses and discussed strategies to effectively manage and mitigate these risks to accelerate ESG governance in businesses, considering the unique challenges and opportunities in Africa to enhance resilience and sustainability in the insurance sector. The forum harped on inclusivity, innovation, and social responsibility in the insurance services sector in driving sustainable growth in the insurance industry.
Dr Emeka Azinge, Faculty, Lagos Business School, wrapped up the proceedings of the forum in a well articulated summary of learnings while Jonathan Ikeolumba, Faculty, Enterprise Development Centre, gave the call to action. Mrs Oreva Atanya, Head, Sustainability, Lagos Business School, closed the forum responding to questions. She delivered the vote of thanks, and urged the insurers to stay ahead of regulation by creating principles the regulators can adopt which will guide the insurance players in the sector. She added that the insurers should emulate the bankers’ committee in forging sector-wide principles that create better outcomes for businesses to help curb multi-dimensional risks.
Lagos Business School is Africa’s leading management education institution and the LBS Sustainability Centre is a leading knowledge centre that brings together the theory and practice on business and sustainability for the advancement of performance and development outcomes. For more information about the initiatives and upcoming events by the Lagos Business School Sustainability Centre, please contact email@example.com. Together we can work towards a sustainable future for businesses on the continent.