Achmea, the largest insurance group in the Netherlands, has an ambitious responsible investment policy. With climate change as one of their priorities, it explores green roofs: ‘I now realize that the uptake of nature based solutions could be a way to adapt to the risks of climate change’. This solution is part of a larger series that were published in 2016.
As the largest insurance group in the Netherlands, Achmea covers the risks of 10 million clients. The group holds more than EUR 100 bn assets under management. Achmea’s core business is providing insurance to cover its clients’ potential risks. Corporate Social Responsibility is an important driver for Achmea. As a result, it has an ambitious responsible investment policy with a focus on health, nature, human rights, labour rights and climate change. As climate change emerges as a serious risk for insurers and their clients, the insurance sector is looking for ways to manage these risks. One possible way is a role in the uptake of green roofs to protect buildings and households from increased flood damage.
Changing risks changes business
Liesbeth van der Kruit, Sustainability Manager at Achmea: "Climate change is an emerging risk for the insurance industry, its clients and for society at large. We are already facing increasing damages as a result of extreme weather events and it is expected to get worse. That is why climate change is high on the agenda of the insurance industry and its – international – organisations. It is key for the industry to come up with risk solutions for both its individual clients and society at large. Improving resilience by preventative measure, on an individual and collective level, reduces the risks and keeps insurance affordable. We don’t have all the answers yet, but Achmea is looking for ways to prevent damage and thus lowering risks for our customers and our company."
Menno van Lieshout, Senior CSR Advisor at Achmea adds: "The uptake of nature based solutions could be a way to adapt to the changing risk landscape. When I came across the Green Deal Green Roofs, I decided to use this as a specific case. I wanted to know about the benefits of green roofs for an insurance company and its clients. As such I started researching, asked a colleague from the damage insurance department for help and began connecting the dots. I discovered that as a nature based solution, green roofs can play an important role in buffering water. This prevents considerable damange caused by climate change related weather events. I am convinced that nature based solutions are essential for climate adaptation and thus play an important role in the resilience of households, companies and public infrastructure. I see it as my job to raise awareness among my colleagues that we can truly contribute to climate adaptation and have to develop products to realize that."
Improved water management due to engagement
The Enhancement Engagement Program is one of the pillars of Achmea’s responsible investment policy. In this program specific ESG-targets are defined in an agreement with a specific investee. The investee has to improve its practices within three years. These agreements are binding, meaning that if the company falls short, it can be excluded from further investment. Biodiversity – one of the investment criteria within the core theme ‘nature’ – is an important topic under the Enhancement Engagement Program. Menno van Lieshout: "I now realize that the uptake of nature based solutions could be a way to adapt to the risks of climate change."
Under the Enhanced Engagement Program, Achmea engaged with Mondelez International (Kraft) on its water usage. "This has led to water management and improved reporting on water use. Due to our involvement, the snack producer has mapped its dependency on water and made an overview of other water users in the regions where they are operating. We requested a blueprint of water costs for both their own production and those of their suppliers, including the financial and reputational risks they are facing. As a result of this successful engagement, the company now has structural reporting on around water issues. The Enhanced Engagement Program has shown the importance of managing the water related risks in our investments. Our next step is to do an assessment with the Natural Capital Guide of the VBDO and CREM."
Achmea was one of the frontrunners that formed part of a Community of Practice of Financial Institutions and Natural Capital (CoP FINC), which aimed to accelerate the transition to sustainable finance. This solution is part of a larger series of best practises that resulted from this CoP.