Insurance broker and risk advisor Marsh has announced the launch of a new directors and officers liability insurance initiative that will recognise US-based clients with superior environmental, social and governance frameworks.
Under the initiative, participating clients will engage with select law firms – including Norton Rose Fulbright and Orrick, Herrington & Sutcliffe – to independently review, evaluate, and in some cases strengthen their ESG frameworks. Subject to underwriting, the clients will then be considered for preferred D&O policy terms and conditions in ESG-related exposures – including climate change disclosures and representations – from four participating D&O carriers: American International Group, Berkshire Hathaway Specialty Insurance, Sompo International and Zurich North America.
The initiative comes during a spike in ESG-related stakeholder activism and litigation and an evolving global regulatory environment. It also demonstrates how investing in strong ESG initiatives can positively impact companies’ bottom lines, Marsh said.
“Our clients have endured one of the most challenging D&O markets in decades, and the risk landscape is only intensifying, especially as it relates to ESG issues like climate change and diversity,” said Maureen Gorman, a managing director in Marsh’s US FINPRO practice. “As clients continue to invest in ESG initiatives, it is right that they be recognised as a better risk by underwriters. By working with these select law firms, we are ensuring clients have access to leading independent ESG expertise that can help validate and elevate their ESG efforts, becoming eligible for more favourable coverage.”
“Marsh is proud to introduce D&O coverage enhancements that recognise organisations taking a proactive approach to managing the risks associated with ESG, including the transition to a low-carbon economy,” said Amy Barnes, head of climate and sustainability strategy at Marsh. “We look forward to replicating this initiative in London and in other parts of the world over the coming months. Marsh McLennan has co-led the product and services development of the Prince of Wales’ Sustainable Markets Initiative Insurance Task Force, and we are pleased to be driving climate innovation in our industry.”