Global insurance broker Marsh has announced the launch of its Environmental, Social and Governance (ESG) Risk Rating, an assessment tool to measure an organisation’s ESG performance, enabling organisations to improve their ESG risks and gain access to additional insurance market capacity.
Marsh’s ESG Risk Rating is measured against more than 10 internationally recognised standards and frameworks published by leading organisations, including the Global Reporting Initiative, the Sustainability Accounting Standards Board, the Task Force on Climate-related Financial Disclosures, and the World Economic Forum. It scores a client’s performance across 18 ESG themes. Upon completion of the free assessment, the organisation receives a rating for each ESG component and an overall ESG risk score. Companies can use the result to identify their most critical sustainability and climate-related risks.
As part of the offering, Liberty Mutual Insurance clients in the US and Canada who opt in to Marsh’s ESG Risk Rating will receive complimentary access to risk advisory services related to sustainability and climate-related risks and opportunities.
“Embedding ESG is increasingly a source of competitive advantage to the organisations that do it well,” said Amy Barnes, head of climate and sustainability strategy at Marsh. “With the ESG Risk Rating, we are providing our clients with a clear framework from which to better understand their ESG performance, make more informed investment decisions, and realise better risk management outcomes.”
“We are excited to collaborate with Marsh on this important initiative to help firms improve their understanding of their ESG risks,” said Tracy Ryan, president of North America Global Risk Solutions at Liberty Mutual. “Our risk advisory offer is in mutual recognition of the importance of ESG and Liberty’s commitment to help clients advance their sustainability journeys.”
As part of the development of the ESG Risk Rating, Marsh also plans to publish anonymised ESG risk insights by county and sector.
Last year, the broker launched a directors and officers insurance initiative that recognises US-based clients with superior ESG frameworks. Following an independent review of their ESG framework, Marsh clients are considered for preferred D&O policy terms and conditions on ESG-related exposures.