In a bid to address the growing significance of environmental, social, and governance (ESG) matters in shaping the future of businesses, the Chartered Insurance Institute’s (CII) Broking Community New Generation group has published a new guide detailing how small and medium-sized (SME) brokers can navigate this pivotal territory.
The guide comes from research carried out by the CII Broking Community New Generation group for the 2022/23 period. In their research, the group sought to understand how ESG strategies are being implemented by larger firms and how these measures could be adopted by SME brokers.
It was observed that most larger brokers have dedicated individuals or committees that are responsible for the formulation and execution of ESG strategies. However, the same level of attention to ESG matters was not evident among SMEs.
Another crucial insight from the research revealed disparities in the understanding of ESG targets among employees.
According to the study, both larger firms and more senior staff are more like to have a much clearer grasp of their organisations’ ESG targets compared to employees at entry and intermediate level roles or at SME brokerages.
In fact, less than a quarter of entry-level employees felt confident in their understanding of ESG targets, while over a third of those surveyed admitted to having no understanding at all. Moreover, a mere 32% of employees at SME brokers reported understanding their firm’s ESG targets.
The group’s research also shed light on recruitment practices in the industry, showing that larger brokers demonstrated greater consideration for diversity in their hiring processes.
Approximately 89% of respondents from larger firms agreed that their companies “actively consider diversity when recruiting,” compared to only 77% of respondents from SME brokers. Additionally, 22% felt that their board lacked diversity entirely.
Considering these findings, the CII Broking Community New Generation made several key recommendations for SME brokers to enhance their ESG practices, including the following:
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