Business
- ARC Limited earns lowest-risk rating amongst global insurance company peers
- Top score reflective of organisation’s continued focus on ESG priorities
THE African Risk Capacity (ARC) Limited has received the global insurance industry’s top overall environmental, social and governance (ESG) score.
The ESG evaluation by Sustainalytics is a comprehensive assessment of a company’s preparedness to meet future risks and opportunities linked to ESG factors, such as climate change, regulatory risk and reputational issues.
Sustainalytics’ ESG Risk Ratings also provide investors with third-party validation of the company’s sustainability performance, along with insights into why certain ESG issues are considered material for a company and how well it manages those risks.
ARC Limited CEO Lesley Ndlovu says the organisation’s top ESG score in the insurance industry is reflective of the leadership role it plays in helping to mitigate and manage the effects of climate change on the African continent. “We are proud to have earned the highest ESG ranking in insurance ahead of other prominent global insurance companies. This third-party validation of our business is a great asset for us as we seek to partner with ESG-conscious reinsurers and investors to make a difference on the African continent,” says Ndlovu.
Through this favourable ESG rating, ARC Limited positions itself as an even more attractive partner for like-minded organisations seeking to reach the most vulnerable people in Africa. Through these strong partnerships, we enhance our potential to provide rapid financial support to mitigate the impact of natural disasters.
Established in 2014, as the commercial subsidiary of the ARC Group, ARC Limited provides natural disaster insurance relief to African countries. Along with its partners, which provide premium support, the insurer has already paid over US$65m to seven countries to provide drought relief and address the economic concerns these countries’ most vulnerable citizens face.
Most recently, ARC Limited paid out US$2.1m to the Madagascar Government to meet the food security needs of over 600,000 people affected by the devastating drought.
“ARC Limited’s role as a parametric insurer is critically important in building resilience and ensuring a country is able to bounce back swiftly after a natural disaster. But beyond that is our firm focus on providing innovative solutions to small and medium scale farmers through partnerships with aggregators and providing reinsurance to local insurance companies,” says Ange Chitate, COO ARC Limited.
ARC Limited’s ESG score was calculated following an independent audit of the company’s business practices and policies. Performed by Sustainalytics, a leading ESG research, ratings and data firm, the assessment considers risks of companies on a scale of 0-100, with 0 indicating the lowest risk.
At 10,3, ARC Limited’s risk rating is the lowest amongst its global peers. No events or policies were identified that may negatively impact stakeholders, the environment, or the company’s operations. In terms of ESG risk management, ARC Limited received a strong score of 66.3, indicating the robustness of the company’s ESG programmes, practices, and policies.
ARC scored low or negligible risk ratings terms of Human Capital, Business Ethics, Corporate Governance and ESG Integration.
The independent endorsement is particularly timely as the group is raising its profile in the run up to COP26, according to a release by Chinedu Moghalu, senior communications and advocacy advisor, African Risk Capacity Group.
African Risk Capacity (ARC) Group consists of ARC Agency and ARC Insurance Company Limited (ARC Ltd). ARC Agency was established in 2012 as a Specialized Agency of the African Union to help the Member States improve their capacities to better plan, prepare and respond to weather-related disasters. ARC Ltd, comprised of its members, including Burkina Faso, Mali, Mauritania, Niger, Senegal, The Gambia, Malawi, and Kenya, is a mutual insurance facility providing risk transfer services to the Member States through risk pooling and access to reinsurance markets
ARC was established on the principle that investing in preparedness and early warning through an innovative financing approach is highly cost-effective and can save upward of four dollars for every dollar invested ex-ante. Together, the Group helps to improve Member States responses to climate-related food security emergencies.
With the support of the United Kingdom, Germany, Sweden, Switzerland, Canada, France, the European Union, the Rockefeller Foundation, the United States, IFAD, AfDB, WFP and STARTNETWORK, ARC assists the AU Member States in reducing the risk of loss and damage caused by extreme weather events affecting Africa’s populations by providing, through sovereign disaster risk insurance, targeted responses to natural disasters in a more timely, cost-effective, objective and transparent manner. ARC is now using its expertise to help tackle some of the other most significant threats faced by the continent, including tropical cyclone, and outbreaks & epidemics.
Since 2014, 62 policies have been signed by the Member States for cumulative insurance coverage of US$719 million for the protection of 72 million vulnerable populations in in participating countries.
– July 19, 2021 @ 11:37 GMT |
Tags: Ange Chitate ARC Limited receives overall lowest-risk ESG rating in insurance industry Chinedu Moghalu Lesley Ndlovu
