QBE creates new ESG risk management framework for SMEs | Insurance Business UK
QBE has launched a new tool which provides a risk management framework for its SME customers.
The tool, developed by QBE’s Risk Solutions practice, offers a template sustainability policy and environmental, social and governance (ESG) framework, enabling SMEs to identify, monitor, and manage ESG issues.
It was developed after QBE recognised that while larger businesses have been establishing their own ESG framework due to increasing disclosure requirements, the same cannot be said of small and medium-sized businesses – especially when they are more limited in terms of budgets and resources for sustainability projects.
Recent research conducted by QBE found that SMEs were less likely (26% and 34%) to say ESG was currently a top priority for their business than larger businesses (54%). However, more than a third of small businesses (34%) and nearly half of medium-sized businesses (46%) said they were currently worried about potential liability from failing to deliver on environmental initiatives or report climate related exposures.
“There is increasing regulation and numerous policy interventions on sustainability issues, as well as growing numbers of international standards, best practice frameworks and voluntary initiatives in specific regions and sectors,” said QBE Europe Risk Solutions practice leader Deborah O’Riordan. “In this context, it is more important than ever that organisations develop a structured approach to considering and managing sustainability.”
A release noted that QBE has plans to further develop the ESG framework into a toolkit that includes further guidance, and eventually convert it to an online assessment so that data can be consolidated and shared through the firm’s web-based risk assessment portal, QRisk.
“Companies should not wait for an adverse incident before they address their sustainability goals – a reactive approach could prove costly and give rise to criminal charges, enforcement actions, management liability claims, injury and death, reputational damage, loss of revenue, and ultimately, business failure,” O’Riordan continued.