EMBRACING THE FUTURE ENCOURAGING SOLUTIONS FOR TOMORROW'S CLIMATE AND A MORE INCLUSIVE SOCIETY - Allianz
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EMBRACING
THE FUTURE
ENCOURAGING SOLUTIONS FOR
TOMORROW’S CLIMATE AND
A MORE INCLUSIVE SOCIETY
ALLIANZ GROUP SUSTAINABILITY REPORT 2016
Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
WELCOME
Allianz is one of the strongest
financial communities in the world.
More than 86 million customers in
more than 70 markets rely on our
comprehensive range of insurance
products and funds. Allianz stands
for trust, based on the integrity,
resilience and dedication of our over
140,000 employees. Our customers
are at the heart of our business. We
strive for profitable and sustainable
growth and support our customers
to address tomorrow's challenges.
We hope you enjoy reading our IN THIS REPORT The 'In focus' section takes an in-depth look at our
key priorities of Climate Change and Social Inclusion
Sustainability Report 2016. This year, having completed a new Stakeholder
– including the latest global trends, developments
Expectation Survey, we have taken another step
and our response.
forward in evolving our sustainability strategy and
our reporting approach. 'Managing Sustainability' provides further detail on
our strategy and governance, and we outline the
We begin by providing a high-level snapshot of our
progress we have made over our five roles in 2016 in
corporate strategy and our stakeholder engagement
'Allianz's roles'.
approach, before discussing the outcomes of our
latest materiality assessment. We then go on to You can find detailed data and further information
look at what the results mean for our Corporate on data assurance and GRI in 'About the report' at the
Responsibility Strategy, priorities and roles. end of the report.
1
Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
CONTENTS ALLIANZ GROUP
AT A GLANCE
1 OVERVIEW 1
– Allianz Group at a glance 2
– Sustainability Performance Highlights 3
– Introduction from the CEO 4
– The Renewal Agenda 5
– Stakeholder Engagement 6 Total revenues approx.
122.4bn
– Stakeholder survey and materiality
assessment 2016 8
– Our Corporate Responsibility Strategy 10
– The Sustainable Development Goals 11
Euro
2 ALLIANZ IN THE WORLD 12
– In focus: A call to action on climate change 13
– In focus: Breaking down barriers to Third-party assets of Over
1,361bn 140,000
social inclusion 17
3 MANAGING SUSTAINABILITY 22
Euro employees worldwide
– Our Corporate Responsibility Strategy 23
– Our Corporate Responsibility Governance 24
– Sustainability in insurance and investment 26
4 ALLIANZ’S ROLES 28
Sustainable Insurer 29 Allianz Group serves in more than
Responsible Investor 34
Trusted Company
Attractive Employer
Committed Corporate Citizen
42
52
60
86.3mn 70
customers countries
5 ABOUT THE REPORT 67
– Overview of Targets and Achievements 68
– Ratings, Recognition and Memberships 71
– Reporting Parameters, Scope and Materiality 72
– Key Sustainability Data 73
2
Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
SUSTAINABILITY KPI KPI KPI
PERFORMANCE 1.9 billion 156 100%
HIGHLIGHTS Euro new debt and equity
investments in renewable energy
Sustainable Solutions score for ESG in insurance
integration by DJSI
Revenues increased to 302.5 million
SUSTAINABLE Euro in the emerging consumers market
See more on page
INSURER 1.1 billion Euro revenue generated 29
through Sustainable Solutions
225 million Euro in equity divested
RESPONSIBLE from coal-based business models See more on page
INVESTOR Launched new ESG Scoring approach 34
–25.3% CO2 emission reduction per
TRUSTED employee since 2010 See more on page
COMPANY +2,200 leaders trained in Integrity 42
37.2% of Allianz managers
ATTRACTIVE were women See more on page
EMPLOYER 64% score in Work Well index 52
Launched Encouraging Future Generations
COMMITTED Program including a three-year partnership
CORPORATE with SOS Children's Villages See more on page
CITIZEN 19.4 million Euro corporate giving
60
See pages 68–70 for a full overview of our sustainability targets and achievements.
3
Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
INTRODUCTION 70% 55%
FROM THE CEO
score in the Inclusive of the business segments measuring NPS*,
Meritocracy Index significantly performed above the market average
72%
Employee Engagement
Gold Class
Sustainability Award by
Index score RobecoSAM (DJSI)
WHY IS SUSTAINABILITY IMPORTANT And we integrate Environmental, Social, and WHAT MADE 2016 SPECIAL FOR YOU? But we can still do better. We need to continually
FOR ALLIANZ? Governance (ESG) principles throughout our
Perhaps the greatest moment was launching
improve our reporting and transparency practices.
investment and insurance business by holding This is why we introduced external auditing for
Insurers are tied by the nature of their business to our new Social Inclusion program, Encouraging
business decisions up to the light and asking our sustainability data and information in 2016 to
healthy and sustainable developments in society. Future Generations, and our partnership with SOS
ourselves, ‘Will this benefit society and our underscore the accuracy of our Sustainability Report.
We can and must be a force for good. We help our Children’s Villages. I know we can support young
customers in the long term?’
customers to cope with challenges such as climate people worldwide and Allianz is deeply committed Allianz is leading this global transformation from the
change and natural catastrophes, personal safety HOW DO YOU APPLY SUSTAINABILITY to promoting equality and social inclusion. I want front. That’s what our customers expect from us and
and data security risks and momentous changes PRINCIPLES? Allianz to lead a transition in culture worldwide that’s what I expect from the people at Allianz who
sweeping society. As a global insurer and long-term where sustainable, responsible business becomes serve them. Our own self interests are inseparable
investor, sustainability is part of our DNA. We think We apply sustainability principles across our entire the norm. from those of a healthy, sustainable society. We will
in long-term outcomes and how we can make the business. We promote strong, sustainable portfolios use our position of strength to help make the
world a more resilient place. using ESG considerations and our customers’ WHAT KEEPS YOU UP AT NIGHT? idea of a better, healthier, and cleaner tomorrow
long-term interests. This benefits our business become real.
What I worry about is climate change, which poses
WHAT IS THE FOCUS OF YOUR CORPORATE for sure – like I said, we take the long-term view
the biggest threat. This is one reason why we no
RESPONSIBILITY STRATEGY? – but it also has a huge positive impact on our
longer finance coal-intense business models and will
employees, our stakeholders, and society at large.
The newly adapted Corporate Responsibility Strategy double our equity investments in renewable energy.
In 2016, for example, we introduced the Allianz ESG
is built on three pillars: Low-Carbon Economy,
Scoring approach for investments, which allows Embedding sustainability in all parts of our
Social Inclusion, and Business Integration. And we’re
us to manage our portfolio taking sustainability business doesn’t happen overnight. It is an ongoing
already putting this into practice. We strongly
into consideration. process. We have already made great strides and
support the renewable energy transition and
are recognized as best-in-class, as the Dow Jones Chairman of the Board of Management, Allianz SE
decarbonization of the economy through sustainable
Sustainability Index rating shows. We rose six
investments in things like wind parks. We have,
percentage points on the scale and climbed to Gold
as a company, shrunk our own carbon footprint.
from Bronze in the rating in 2016, making Allianz the
We support children and youth through our
highest placed primary insurer.
Encouraging Future Generations Program, which
empowers young people to grow with confidence
and shape resilient, more inclusive societies.
* Focus on retail business
4
Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
THE RENEWAL
AGENDA 5
Inclusive
2
Digital by
Meritocracy Default
1
At Allianz, we aim to create sustainable economic • Technical Excellence: our customers expect us True
value through a long-term approach to corporate to understand the risks they face throughout their Customer
governance, social responsibility and environmental lives. They also expect us to prevent and manage Centricity
stewardship. During our 126-year history, we have
developed the culture, systems and processes that
these risks for them. For this, we need excellent
data quality, superior underwriting systems and 4
enable us to do that. This is critical to our business
success as we commit to deliver on our promises
market-leading tools.
• Growth Engines: emerging markets and assistant
Growth
Engines
3
to customers, to investors, to communities and to Technical
solutions for sharing economies, new technologies, Excellence
society as a whole.
healthcare and leisure are becoming more
RENEWAL AGENDA important. We want to embrace these growth
areas by sharing our ideas and collaborating with
The world and our industry are changing fast and start-ups and other stakeholders.
fundamentally. This is spurring us on to renew
our way of doing business. If we are to deliver • Inclusive Meritocracy: to achieve the above,
our ambition of being the most trusted financial we need a workforce that is agile, innovative and “The company’s Renewal Agenda
institution and a global sustainability leader, we must daring. We want to encourage this by developing sets ambitious targets and
continually adapt our business strategy in response smarter ways of rewarding ideas and performance,
to the most pressing issues. and by continuing to ensure Allianz is a great place puts customers at the core of
Our Renewal Agenda focuses on five goals:
to work, for everyone. actions. Our macro-economic
Our Renewal Agenda is fostered by a comprehensive and technological environment
• True Customer Centricity: customers expect cultural change process encompassing customer
excellent quality and flexibility from our products and market excellence, collaborative leadership,
is changing fundamentally.
and services. We want to develop our processes entrepreneurship and trust. The Renewal Agenda We will adapt and in doing this,
based on their needs, exceed their expectations therefore addresses our stakeholder views (e.g.
and build loyalty and trust in our brand. we act from a position of strength.”
customers, employees and shareholders). We are
• Digital by Default: we need to deliver state- also taking into account our stakeholders' feedback
of-the-art insurance and service offerings for in our Corporate Responsibility Strategy to be able to
the connected age. Becoming a fully digitalized respond to our most material issues.
company means we can offer our customers
exciting, smart and secure products and services
through any device or channel. Oliver Bäte
Chairman of the Board of Management, Allianz SE
5
Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
STAKEHOLDER STAKEHOLDER ENGAGEMENT FRAMEWORK
ENGAGEMENT
Customers
Investors Customer surveys and dialogues
OVERVIEW Learning from and sharing customer insights
PARTNERSHIPS AND COLLABORATION Dialogues and roadshows Review of financial services sector
As a multinational business, the challenges we Engagement across our investment portfolio developments
Long-term partnerships are instrumental to
face are increasingly diverse and interconnected. Ratings and benchmarks Research and development to support
delivering our sustainability agenda. Our strategic
We can only understand global trends and how Rating results e.g. DJSI product innovations
partners include:
they affect our products, services and strategy by Using the Net Promoter Score (NPS)
working closely with a broad range of individuals SOS Children’s Villages: supporting Allianz Risk Barometer Survey
and organizations. Besides our many commitments young people from challenged
to international and national sustainability bodies backgrounds to develop the skills and
and initiatives (see page 25), our engagement experience they need to succeed through
activities focus on the four stakeholder groups who education and participation (see page 63);
are most impacted by our business.
LISTENING TO AND ENGAGING Deutsche Gesellschaft für
WITH OUR STAKEHOLDERS Internationale Society
Zusammenarbeit (GIZ): German
Customers Partnerships for civic engagement
Society for International Cooperation – e.g. the Vision Summit
Feedback from our customers helps us to improve
the first public-private partnership for Employees
our products, services and processes, and to offer Thought leadership on global issues
easy and adaptable solutions. microinsurance activities (2011–2017); e.g. Allianz Future Forum Allianz Engagement Survey (AES)
Panel discussions and roundtables Employee dialogues and networks
Employees Foundations, donations and volunteering Corporate volunteering programs
Because we believe employees who are engaged International Paralympic Committee
Press events, journalist surveys and roundtables
with and committed to their jobs generate long-term (IPC): partner since 2006 and the first IPC
Formal dialogues with NGOs
value for our business, we continuously seek their ‘International Partner’ – since 2011. and ESG professionals
views and respond to their ideas and concerns.
Society As part of our engagement process we ask
Given the pace and scale of global change, it is vital specific questions to our stakeholders which
we work with other partners, governments and helps us determine what matters most to them.
institutions to identify sustainable solutions and This information is helpful to us when defining
maximize our positive impact. our strategy.
Investors
We engage with our investors to communicate our
sustainability strategy and performance, enabling
them to make informed decisions about their own
investments and us to understand their expectations.
6
Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
STAKEHOLDER ALLIANZ MATERIALITY PROCESS
ENGAGEMENT
Reporting and
communication Monitoring trends
Communicating and analyzing risks
OUR MATERIALITY PROCESS Benchmarking our progress and Reviewing what
Understanding
and external gathering stakeholder affects our business
Our most material issues are those that are perceived what
feedback feedback
as vital for business success and sustainability by matters most
our stakeholders and by Allianz. We engage with
key stakeholder groups to identify what they see as
materially important for sustainable development at
Allianz. The insight they provide enables us to focus
our sustainability strategy, activities and reporting on
the right areas. Ongoing auditing
and benchmarking Engagement with
We base our materiality approach on a number of Ensuring strong
our stakeholders
voluntary international standards and guidelines, Benchmarking with governance
including the Global Reporting Initiative (GRI) G4 other sustainability Understanding what
Regular engagement
guidelines, a range of sustainability indices, and strategies, reporting is most material
with the Group ESG
engagement with expert working groups, such as approaches and to our internal and
Board
the United Nations Environment Programme Finance rating assessments external stakeholders
Initiative. We use a wide variety of engagement
methods, such as conferences, workshops, road
shows, surveys, face-to-face interviews and peer
reviews to understand our material issues and
shape our sustainability approach.
Strategy
Internal validation
development
Exploring how we
Integrating the
can address trends
material issues into
and risks with our
our sustainability
products and services
strategy
Developing
our response
7
Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
STAKEHOLDER SURVEY AND MATERIALITY ASSESSMENT 2016
PERSONAL IMPORTANCE OF MEGATRENDS TO STAKEHOLDERS AGAINST PERCEIVED IMPORTANCE OF TREND TO ALLIANZ
70% Size of bubbles = STAKEHOLDER SURVEY
Allianz ability to
influence the effects During August and September 2016, GfK SE
of these megatrends
surveyed over 6,000 individual stakeholders about
Climate Change from Corporate
Responsibility what they see as the most important global issues
and Environment perspective for Allianz and the potential solutions we provide.
The results were validated via several internal
60% workshops involving experts from departments
Personal Digitalization including: Group Strategy, Group Market
Perceived Importance to Stakeholders
Customer Safety Management; Corporate Communications; Allianz
Climate Solutions; Corporate Responsibility; and
Human Resources.
Fiscal Crisis All stakeholders viewing are weighted evenly so they
50% are not disproportionately affected by the number
of responses.
Politic Instability Societal Change
Stakeholders surveyed
Chronic Diseases
40% No.
Allianz employees 5,632
Globalization
Allianz customers 501
Urbanization
Societal stakeholders 113
30% Tied agents 158
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Perceived Importance for Allianz as a Business
The matrix shows the relative personal importance the impact of these trends through the solutions
of megatrends to stakeholders against the perceived we provide and the contribution we make – which
importance of the trend to Allianz. Additionally, we provides a strategic focus for our overarching
have evaluated our ability to influence (bubble size) Corporate Responsibility Strategy.
8
Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
STAKEHOLDER SURVEY AND MATERIALITY ASSESSMENT 2016
PERSONAL IMPORTANCE OF SOLUTIONS TO STAKEHOLDERS AGAINST PERCEIVED IMPORTANCE OF SOLUTION TO ALLIANZ
90%
Based on the outcomes of our materiality assessment,
we also plotted the relative personal importance to
stakeholders of the solutions Allianz provides against 85%
their perceived importance for our business and 3
their relevance to corporate responsibility-related 80% 2 1
departments. Furthermore we mapped the solutions
in the graphic to our strategic CR pillars to show to
which pillar each solution belongs. Perceived Importance to Stakeholders 75% 6 5
8 7 4
NEXT STEPS
70%
The perceived most important megatrends 9
and risks for Allianz across all surveyed target 11
groups and countries which we are able to 65% 12
address with our solutions and our Corporate 13
10
Responsibility Strategy are in particular: climate 60% 15 14
change and environmental issues such as
natural catastrophes; personal customer safety, 16
17
including data security risks; and societal change. 55%
19 18
We have used the outcomes of this assessment to
guide our reporting of issues and performance for 50%
2016 and we will continue to use the insights to
further develop our sustainability reporting, strategy
45%
and roles in the coming years.
In order to be considered a Responsible Investor,
we will continue to integrate ESG criteria across 40%
our investment decisions. As a Sustainable 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90%
Insurer, we need to continue our focus on fair
Perceived Importance for Allianz as a Business
treatment of claims as well as on responsible sales
and marketing communication. Our role as an Key Low-Carbon Economy
Attractive Employer is of very high relevance, 1 Data Protection and Privacy 8 Human Capital Management 15 Operational Eco-Efficiency
2 9 16 Transparency Social Inclusion
as is being a Trusted Company. Compliance, Financial Performance Sales and Marketing
data and privacy protection, improving customer 3 Customer Relationship Management 10 ESG Business Integration 17 Sustainable Products & Services Business Integration
satisfaction and financial performance all play a 4 Corporate Risk Management 11 Stakeholder Engagement 18 Advocacy Practices
Overarching Topics
major role. Supporting customers’ health and safety, 5 Corporate Governance 12 Responsible Procurement 19 Community Engagement/
Social Inclusion Initiatives
as well as local business are particularly important 6 HR and Labor Practices 13 Sustainability Strategy
Size of bubbles =
if Allianz wants to be considered as a Committed 7 Occupational Health and Safety 14 Responsible Investment influence of core Corporate
Corporate Citizen. Responsibility related departments
9Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
OUR CORPORATE RESPONSIBILITY STRATEGY
INFLUENCED BY THE OUTCOMES WE HAVE ALIGNED OUR STRATEGY AND TRANSLATE THOSE INTO FIVE
OF THE MATERIALITY ANALYSIS TO THREE PILLARS ROLES ALLIANZ PLAYS IN SOCIETY
Taking a long-term view
SUSTAINABLE of the world to help our
• Portfolio customers manage risk
decarbonization INSURER
See more on page
29
• Reducing
LOW-CARBON
environmental
ECONOMY impact Making investment
decisions that foster
• Sustainable RESPONSIBLE sustainable markets
Solutions… INVESTOR and societies
See more on page
34
• Climate change and • Emerging
WHAT environmental issues markets Demonstrating integrity,
MATTERS • Personal customer SOCIAL • Diversity TRUSTED
COMPANY
competence and reliance
in everything we do
safety INCLUSION
MOST... • Encouraging
Future
See more on page
42
• Societal change
Generations…
Fostering a working
environment where
ATTRACTIVE both people and
EMPLOYER performance matter
• ESG integration See more on page
BUSINESS • Responsible
52
INTEGRATION sales
Acting as a committed
• Data privacy…
COMMITTED corporate citizen and
building stronger
CORPORATE communities
CITIZEN See more on page
60
10Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
HOW WE CONTRIBUTE TO THE SUSTAINABLE DEVELOPMENT GOALS
DELIVERING THE GLOBAL SUSTAINABLE SUSTAINABLE RESPONSIBLE TRUSTED ATTRACTIVE COMMITTED
DEVELOPMENT AGENDA INSURER INVESTOR COMPANY EMPLOYER CORPORATE
In September 2015, countries around the world CITIZEN
adopted a new set of goals for the next 15 years
to end poverty, protect the planet and ensure
prosperity for all. The Sustainable Development
Goals (SDGs) include specific targets that can
only be achieved by governments, civil society
and business working together around the
world. They are indivisible, interlinked and they
influence each other, requiring delivery through
multi-outcome collaborations across the entire
sustainable development agenda.
We recognize that as an insurance and financial
services company we contribute to some SDGs
more directly than to others. The SDGs we can
primarily match our activities against are shown
in the box. For further info on aligning our targets
Our strategy also reaffirms our commitments to the Ten Principles of the UN Global Compact (UNGC), a voluntary initiative based on CEO commitments to implement
with the SDGs please see our website.
10 universal sustainability principles. We have been a participant in the UNGC since 2002 and it is included in our Code of Conduct. We annually communicate our
progress in the fields of human rights, labor standards, environmental protection and anti-corruption.
Our latest reports for the UNGC and the German Sustainability Code (GSC) can be found on our website as well as on the UNGC and GSC websites.
11Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
ALLIANZ
IN THE WORLD
Our business is, by its very nature,
orientated towards the future.
We continually strive to look
beyond the short term and use our
knowledge and expertise to focus
on future risks and impacts.
We are connected to people in
over 70 countries – countries that
are home to our employees, our
customers, investors and society.
As a result, we instinctively take a
global view of the change that is
happening around the world.
IN THIS SECTION
In focus: A call to action 13
on climate change
In focus: Breaking down barriers 17
to social inclusion
12Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
IN FOCUS:
A CALL TO ACTION
ON CLIMATE CHANGE
2016 was a momentous year in the global effort to combat
climate change. The first-ever universal, legally binding
climate deal was ratified by 125 countries in 2016. At the
same time, 2016 was the warmest year on record with polar
sea ice disappearing at an unprecedented rate. We appear to
have reached a new level in terms of both action and impact
around climate change.
At Allianz, we encourage solutions for tomorrow’s climate
today, by working with others to understand the science,
develop opportunities and mitigate impacts. We anticipate
the risks of climate change and protect and care for our
customers through our insurance products, while using our
assets and insurance expertise to enable the transition to
a low-carbon economy. We regularly update our Climate
Change Strategy to refine our approach and up our ambition.
“Today we see the impact of climate
change on our business and understand
the risks it entails in the future. We think
the financial sector can take a lead role
to enable the transition to a low-carbon
world – Allianz is ready to accompany our
clients as a long-term investor and risk
expert on that journey.”
Oliver Bäte
Chairman of the Board of Management, Allianz SE
13Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
OUR CHANGING
WORLD For more detail on United Nations Sustainable Development
Goals please visit sustainabledevelopment.un.org
The World Economic Forum CLIMATE CHANGE THREATENS TO WHAT CLIMATE CHANGE MEANS Allianz Climate Solutions GmbH (ACS) is
RADICALLY CHANGE OUR CLIMATE, FOR THE FINANCIAL SECTOR
considers failure of Climate Change OUR LIVES AND OUR BUSINESS
the Climate Change Center of Excellence of
The consequences of climate change materially Allianz Group. ACS is responsible for Allianz’s
mitigation and adaptation to be the Climate change, mainly caused by human-activity affect insurers’ operations across all lines of Climate Change Strategy. It acts as a focal point
top risk facing society today. induced global warming, poses a major risk to the business. We are exposed in two ways: through and convener of Allianz’s risk and investment
livelihoods of millions of people worldwide. It affects insurance policies covering damage caused by expertise worldwide to catalyze the development
Global Risks Report, 2016 the wealth of societies and the value of companies, natural disasters such as storms and floods; and as of solutions for a changing climate. ACS also
since the frequency and severity of weather large-scale institutional investors with significant offers insurance and advisory services for green
extremes – such as heatwaves, droughts, floods, stakes in companies affected by changing weather energy projects to external clients and Allianz
storms – are expected to increase and the sea level patterns, tightening regulation and shifting entities worldwide. ACS has been hosted by
is rising. The first sectors affected will be coastal consumer behavior. AllianzRe since 2016. You can find out more
infrastructure, agriculture and water, but also energy. about Allianz Climate Solutions here.
For example, global food production will have to
double in the next fifty years to match a growing
world population. When coupled with the need to
address environmental concerns and climate risks,
it is clear that 'business as usual' will not suffice.
IT IS 2016 20°C 198 mm We can build on our experience as a microinsurer
HAPPENING warmest year above normal sea level rise due and reinsurer in agriculture to bring climate risk
ALREADY:
on record North Pole
temperatures
to ice melting
since 1870 insurance mechanisms to vulnerable regions. “The Allianz climate strategy
At the same time, the unprecedented challenge provides us with a compass to
of climate change creates opportunities and help our customers and society
incentives for the development of new technologies
on a global scale that drive economic development at large adjust to changing times.
2/3 2/3 43% rise and generate social benefits. At Allianz Climate Solutions, we
of the world’s biggest of weather- in global water work like a talent scout, finding the
cities in low-lying related losses are demand expected
coastal areas uninsured by 2030 right people within the company
CHALLENGES to pick up new ideas, develop new
AHEAD: business models and engage with
1/3 drop USD 500 USD 22.6 Simone policy makers, academics and
in investment in fossil billion needed every trillion in green
fuels predicted year until 2050 to investment Ruiz-Vergote civil society to improving our joint
by 2040 adapt to climate opportunities Managing Director,
change until 2030
Allianz Climate understanding of climate risks and
Solutions advancing a toolkit of solutions.”
14Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
OUR CHANGING
WORLD
2016: A YEAR OF INTERNATIONAL ACTION
“We have had 125 countries ratify 2016 was pivotal for global action on climate change.
the Paris climate agreement since At the Paris conference (COP21) in December 2015,
195 countries adopted the first ever universal, legally
last year. Now it is important to binding global climate deal to keep temperature
keep the momentum going and rise this century to well below two degrees Celsius
above pre-industrial levels. The agreement entered
implement national plans to into force in 2016 much faster than expected after
combat climate change. We can't enough countries ratified it.
afford to wait to see the effects As part of this agreement, countries have to submit
of climate change and then just long-term national climate plans, which can guide
investors on the speed and milestones of a
pay for the clean-up. It doesn’t low-carbon transition. Another aspect is that
make sense either economically poorer countries that are particularly vulnerable
to climate change should get support to adapt
or socially. If our role is to provide to a changing environment.
resilience for society, as I believe
ALLIANZ ON THE GLOBAL STAGE
it is, then we have an opportunity
At COP 21, Allianz joined the Portfolio
and a responsibility to do so.” Decarbonization Coalition, a group of 27 global
asset owners and managers – together accounting
for over three trillion U.S. Dollars in assets under
management – committed to reducing the climate
impacts of their investment portfolios.
We have upped our engagement in leading industry
initiatives in recent years. Initiatives like the Finance
Initiative of the UN Environmental Programme
+ $3tn 195
(UNEP FI), the Munich Climate Insurance Initiative
(MCII), the Geneva Association, ClimateWise,
Amer Ahmed the Global Innovation Lab for Climate Finance,
CEO, Allianz RE and the Insurance Development Forum (IDF) Total assets under Countries adopted legally
allow us to share knowledge with peers, convey management of Portfolio binding global climate deal
messages to decision makers and jointly develop Decarbonization Coalition
innovative solutions to mobilize finance for a green
transition and to protect the world better from a
changing climate.
15Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
OUR CHANGING 4.6bn 156
WORLD
Euro invested in renewable Sustainable Solutions provided by
energies by Allianz Allianz for our customers
ANTICIPATE.CARE.ENABLE.
OUR CLIMATE CHANGE STRATEGY WE ANTICIPATE THE RISKS OF A CHANGING WE CARE FOR OUR CUSTOMERS… WE ENABLE POSITIVE CHANGE…
We are committed to taking a leading role in
CLIMATE… AS AN INVESTOR AS AN INSURER AS AN INVESTOR, INSURER AND AS
tackling the climate challenge. This means We screen our equity and fixed income investments We advise our customers on how they can reduce
A CORPORATE CITIZEN
managing emissions from our operations, as a using 37 environmental, social and corporate risks and minimize damage, while compensating Enabling as an investor
carbon-neutral company, and using our leverage governance (ESG) criteria – including carbon those who have suffered losses and enabling We are a leading investor in renewable energies
as one of the world’s largest institutional investors emissions, energy efficiency, and environmental low-carbon technology covers. with more than 4.6 billion Euro invested. We want
and insurers. footprint. This guides our development and to at least double our investments in the mid-term.
We actively support the InsuResilience initiative of
implementation of sustainable investment strategies. Allianz also offers several renewable energy funds
EMBEDDING CLIMATE PROTECTION the G7, which aims to provide climate risk insurance
for institutional investors who want to invest in
IN OUR BUSINESS We have stopped financing coal-based to an additional 400 million vulnerable people
low-carbon infrastructure. Once the newest fund,
business models. by 2020, for instance for the agricultural sector,
We are committed to integrating climate protection AREF II, is fully invested, AllianzGI will manage
including weather index insurances or animal
firmly into our core business. As a global leader and Allianz SE, Allianz Global Investors (AllianzGI) and the close to 1.6 billion Euro in renewable energy and
mortality covers.
a good corporate citizen, we want to make the Pacific Investment Management Company (PIMCO) infrastructure projects in Europe.
most of our opportunities to develop solutions for are signatories of the Principles for Responsible We are also joining forces with development See page 37 for how we are
a changing climate and enable the transition to Investment (PRI), which help us leverage our current agencies to pilot innovative solutions in developing enabling the low-carbon economy
a low-carbon economy. responsible investment practice. and emerging countries, e.g. looking at ways to
See page 34 for more on our mitigate risks and insure SMEs and cities against Enabling as an insurer
approach as a Responsible Investor extreme weather events. We provide over 150 Sustainable Solutions for our
Allianz is signatory to the UNEP FI Principles for customers – from special tariffs for electric cars to
Sustainable Insurance (PSI). environmentally-themed funds.
See page 29 for more on our Allianz is developing and providing insurance
approach as a Sustainable Insurer solutions for renewables technologies and energy
efficiency around the world.
See page 31 for how we are broadening
our approach to Sustainable Solutions
Enabling as a company and corporate citizen
We are firmly committed to minimizing our
environmental impact and are committed to a
carbon neutral business model.
Our 2020 targets include reducing CO2 emissions
and energy use per employee by 30% (against 2010)
and reducing paper use per employee by 40% against
a 2014 baseline.
See page 49 for how we are
reducing our impacts
16Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
IN FOCUS:
BREAKING DOWN
BARRIERS TO
SOCIAL INCLUSION
Despite unprecedented social progress in recent decades,
too many people around the world still have limited access to
social, economic and political opportunities. Inequality and
marginalization present a huge challenge and risk threatening
the future social and economic stability of communities around
the world.
We believe social inclusion is one of the most important
challenges society is facing. That is why, in 2016, we made
it one of the three priorities of our Corporate Responsibility
Strategy. To amplify our role as a Committed Corporate Citizen,
we launched Encouraging Future Generations – our new Social
Inclusion program that targets better opportunities for young
people worldwide.
“Social inclusion is one of the most
pressing issues we face today around
the globe. Allianz is proud to contribute
by empowering young people and those
who support them to take action for
positive social change.”
Sabia Schwarzer
Head of Communications and
Corporate Responsibility, Allianz SE
17Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
OUR CHANGING
WORLD For more detail on United Nations Sustainable Development
Goals please visit sustainabledevelopment.un.org
THE WIDENING GAP: “Poverty is not created by people.
SOCIAL EXCLUSION AND INEQUALITY HOW OUR WORLD
Poor people are not the cause of IS CHANGING
In December 2016, the UN published its 2016 Report
on the World Social Situation – Leaving No One poverty. Poverty is imposed from
Behind: The Imperative of Inclusive Development. outside, by creating many obstacles
The report describes the extent to which social
progress has helped to reduce poverty, improve
for them and denying many
health and provide better education around the opportunities to them.”
world. Despite this, real and significant challenges
remain – both social and economic. Many people
are still excluded from the economic, social
and political opportunities that enable them
to participate fully in society and improve their
202mn
people are unemployed
quality of life. For this reason, the 2030 Agenda for globally, including 75 million
Sustainable Development has inclusiveness and young women and men,
shared prosperity at its heart. The UN Sustainable seven million in Europe.
Development Goals (SDGs) target improvements
in social inclusion such as: No poverty, Zero
2bn 1 in 10
hunger, Good health and well-being, Quality Young people, especially those
education, Gender equality, and Reduced Professor Muhammad Yunus who are not in employment,
inequalities. With the SDGs helping to re-shape Nobel Peace Prize Laureate education or training, are the
estimated adults lack access people in the world live under
our Corporate Responsibility agenda, we are using group at highest risk
to a transaction account and the international poverty line
our opportunities to break down barriers to social of social exclusion.
are excluded from the formal of U.S. Dollars 1.90 per person
inclusion, working with our partners and other
financial system. per day.
stakeholders around the world.
65.3mn 745,545 The risk of holding a poorly
paid, precarious or insecure
people, or one person in displaced people applied job is higher today than it
113, were displaced from for asylum in Germany was in 1995.
their homes by conflict and in 2016.
persecution in 2015.
18Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
UNDERSTANDING RISKS-TRENDS INTERCONNECTIONS MAP
SOCIAL Climate
INCLUSION
change
Rising
geographic Environmental
mobility degradation
Rise of chronic
The European Commission defines social inclusion as diseases Urbanization
'a process by which all citizens have the opportunities
and resources necessary to participate fully in
economic, social and cultural life, and to enjoy a
standard of living and well-being that is considered
normal in the society in which they live'. The causes
of social exclusion go far beyond just poverty and
can depend on many different issues, including race,
age, ethnicity, gender, religion, place of residence, Rise of cyber Growing
disability status, sexual orientation - anything that dependency middle class
excludes people from opportunities. in emerging
economies
In its 2017 Risk Report, the World Economic
Forum highlights polarized societies and political
landscapes, along with generational and cultural
divisions, as taking center stage in an increasingly
uncertain environment. Its Risks-Trends
interconnections map (see right) shows how Shifts
profound social instability, large-scale involuntary in power Ageing
migration and unemployment or underemployment
population
are having a significant impact and the extent to
which they are interconnected with many other
issues and challenges affecting society.
Changing
You can read the full report at landscape of Rising
weforum.org/docs/GRR17_Report_web.pdf international income and
governance wealth
disparity
Increasing Increasing
national polarization of
sentiment societies
19Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
WHY DOES SOCIAL INCLUSION
MATTER TO ALLIANZ?
As a global insurer, we rely on the principle of HOW WE CONTRIBUTE… …AS AN ATTRACTIVE EMPLOYER At our 2016 Vision Summit, we hosted over
solidarity. Pooling risks is inherent in our business …AS A SUSTAINABLE INSURER Internally, we support social inclusion through
500 diverse stakeholders to explore solutions
model and we have a major interest in creating to overcome the barriers to social inclusion,
By the very nature of what we do – protecting people our diversity and well-being programs, and by
stable communities. Civil unrest, social tensions especially for young people. We were privileged
and businesses against risk – we have a significant supporting groups, such as women in management
and societal upheaval all pose a major business risk to be joined by Muhammad Yunus, Nobel
positive social impact. Nowhere is this more the case and people with disabilities (see page 56). We also
for Allianz. Peace Prize winner for his pioneering work on
than in emerging markets. We are committed to actively support employee rights and apply core
social business. He explained the effects of the
Of course, we also have an interest in creating expanding our emerging consumer business offer to human rights principles based on the United Nations
concentration of wealth were a big threat to social
empowerment and access to employment close the gap for more people who need access to Universal Declaration of Human Rights throughout
inclusion but said 'wealth concentration can be
for members of society, which in turn creates low cost financial services (see page 32). our worldwide organization.
addressed through social businesses, through
the talented and diverse workforce we rely on.
We are also widening access through our financial As a member of The B Team, we are part of the encouraging entrepreneurship in all…and
Our reputation as a global employer and our license
literacy initiatives. Digitalization is enabling more and 100% Human at Work initiative that aims to grow changing the financial system.'
to operate depend on treating our employees fairly
more people to access insurance as we embrace the human-centered companies designed to deliver
and being a trusted member of society. Talking about how anyone could make a social
opportunities through our Digital by Default strategy. equality, respect, growth, belonging and purpose to
impact, Yunus said he wanted people to see
But it comes with risks – particularly around privacy their employees and the communities in which they
themselves as more than just employees, as
and data protection. We are taking this risk seriously operate. Find out more at Bteam.org
problem-solving social entrepreneurs who can
by enforcing robust security controls (see page 45).
…AS A COMMITTED CORPORATE CITIZEN contribute to solving wider societal problems.
One of the core aims of our Encouraging Future
Allianz operates 14 independent charitable Generations Program is to empower young
foundations that are linked to its subsidiaries all over people to take up this opportunity.
the world. Together, these foundations enable us to
support a wide range of initiatives that tackle social,
environmental and cultural issues in many countries
(see page 65).
To scale up our contribution towards developing
stronger, more inclusive communities, we reshaped
our Corporate Responsibility Strategy in 2016 to
include Social Inclusion as one of its three priorities.
We launched our new citizenship program,
Encouraging Future Generations, which aims to
help break down some of the barriers facing young
people around the world.
20Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
ENCOURAGING
FUTURE GENERATIONS For more detail on United Nations Sustainable Development
Goals please visit sustainabledevelopment.un.org
HOW WE WILL DO IT “With Encouraging Future
• Beneficiaries: children and youth around the world. Generations, we want to empower
• Focus: humanitarian, intercultural and young people to be change makers
economic opportunities.
to transform their own society. We
• Methods: social partnerships, awareness
campaigns, dialogue events, training, awards,
don’t have all the creative solutions,
funds, employee volunteering and fundraising, but if we can start a dialogue and
foundation activities. support the future generations who
GROUP-WIDE PROJECTS have the potential – by providing
• SOS Children’s Villages partnership to support the necessary skills and equal
underprivileged kids (re-launch in 2016).
opportunities they need – then we
• Social Innovation Fund to incentivize projects in can be part of the solution.”
local Allianz entities (planned for 2017).
• Future dialogues to engage youth on social
development (planned for 2017).
• Social-Tech Seed-Fund to support young
entrepreneurs develop digital solutions that solve
We believe young people today Our aim: To empower young people to grow societal challenges (launch planned for 2018).
with confidence and shape resilient, more
hold the key to unlocking the inclusive societies.
solutions society needs for a better
OUR CORPORATE RESPONSIBILITY GOALS
tomorrow. That is why we have
• Empower young people to grow with confidence
launched Encouraging Future and to shape resilient societies. Tatijana Kulas
Generations to provide them with • Engage employees and use their skills, Program Lead Encouraging Future
skills and inspiration, nurturing commitment and enthusiasm for social projects. Generations, Allianz SE
their talents and increasing their • Prove that we deserve acceptance in local For more information on Allianz's role as a
Committed Corporate Citizen see page 60
communities and trust in our brand.
potential to make the most of
the opportunities.
21Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
MANAGING
SUSTAINABILITY
IN THIS SECTION
Our Corporate Responsibility Strategy23
Our Corporate Responsibility Governance24
Sustainability in insurance 26
and investment
“Both Allianz and I personally have long been committed to JOINING THE B TEAM
managing the risks of climate change and advancing equality and In 2016, Oliver Bäte became a member of The
B Team. He joins co-founders Richard Branson,
social inclusion, and I am delighted to be able to contribute our Jochen Zeitz, Muhammad Yunus and 19 other global
expertise to The B Team’s initiatives. Business has an important leaders in their collective effort to redefine the role
role to play alongside other actors in devising innovative solutions of business as a force for social, environmental and
economic benefit.
to urgent problems, and I’m happy to join The B Team in its efforts
to bring these topics to the forefront of the business agenda.”
Oliver Bäte
Chairman of the Board of Management, Allianz SE
22Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
MANAGING SUSTAINABILITY:
OUR CORPORATE RESPONSIBILITY STRATEGY
As a result, we have renewed our focus in three areas:
In 2015, following extensive stakeholder dialogue “We work on integrating
both within and outside Allianz, our Chief Executive,
Oliver Bäte, announced a new business strategy – sustainability into our core business
our Renewal Agenda. Low- and maximizing the transparency
Social Business
The Renewal Agenda focuses on five goals: True Carbon of our sustainability performance.
Customer Centricity; Digital by Default; Technical Inclusion Integration
Excellence; Growth Engines; and Inclusive
Economy We’re constantly analyzing
Meritocracy. It is fostered through a comprehensive opportunities to improve Allianz’s
cultural change process, which is underpinned sustainability performance.”
by customer and market excellence, collaborative
leadership, entrepreneurship and trust (see page 5). using our roles as an using our role as an managing material
Insurer and Investor Insurer, an Employer ESG risks and seizing
In 2016, we continued to develop and implement
our approach, building on the five pillars of our to help manage the and a Committed ESG opportunities, while
success – our integrity, financial strength, technical risks arising from Corporate Citizen to embedding compliance,
competence, operational excellence and talent base. climate change and contribute to more responsible sales,
OUR CORPORATE to promote the inclusive societies. transparency as well
RESPONSIBILITY STRATEGY low-carbon economy. as data protection and
Encouraging
Our Corporate Responsibility Strategy is organized
Our Climate Future Generations privacy across all areas
around three focus areas, through which we respond of our business.
to our material issues. In 2016, we re-defined our Change Strategy is our new social
most material issues to enable us to refocus our lies at the heart of our inclusion program Our global Katharina Latif
Head of Corporate Responsibility, Allianz SE
strategy and organizational design (see page 8). business model that that is promoting ESG Strategy
We are working to better align our Corporate aims to protect people inclusion of young ensures ESG integration
Responsibility Strategy with our company strategy and businesses from risk. people worldwide. in all our insurance
and integrating it further is a priority for the business and
coming years.
direct investments
of proprietary assets.
See page 16 See article on See page 26
page 17
23Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
MANAGING SUSTAINABILITY:
OUR CORPORATE RESPONSIBILITY
GOVERNANCE
The highest governing body for sustainability-related In addition to the Group ESG Board, several
issues is the Group ESG Board. Established in 2012, committees with Board member leadership play an
it consists of three Allianz SE Board members who important role in our decision-making processes:
meet quarterly. The Group ESG Board is responsible
Group Finance and Risk Committee: oversees
for integrating ESG into all business lines and core
risk management and monitoring, including
processes dealing with insurance and investment
sustainability risk. The Committee is the escalation
decisions. It also leads on associated stakeholder
point for ESG-related topics, based on analysis and
engagement. The three Board members assume
deliberations within the ESG Board.
responsibility for specific sustainability topics and
functional departments provide regular updates on Group Underwriting Committee: monitors the
sustainability issues directly to the Board. underwriting business and its risk management,
as well as developing new underwriting policy
Current Group ESG Board members are:
and strategy.
Dr. Axel Theis: member of the Board
Group Investment Committee: monitors the
of Management of Allianz SE since
Group’s investment policy.
2015, responsible for Global Insurance
Lines & Anglo Markets, chair of the
Group ESG Board. CORPORATE RESPONSIBILITY MANAGEMENT between climate and environmental topics, the
Environmental Management function now sits
Jacqueline Hunt: appointed to the Our Group-level Corporate Responsibility
within Allianz Re, working closely with Allianz Climate
Board of Management of Allianz SE management team is responsible for managing
Solutions - our center of excellence on climate
in July 2016, responsible for Asset the strategic framework for all Group-wide
change and responsible for the implementation
Management and US Life Insurance. sustainability activities, developing and introducing
of the Allianz climate change strategy and related
relevant policies, and supporting operating entities
activities. The Corporate Responsibility department
in integrating the Group’s strategic approach
Dr. Günther Thallinger: appointed reports to Sabia Schwarzer (Head of Group
and policies.
as member of the Board of Communications and Corporate Responsibility,
Management of Allianz SE from In January 2016, we merged our Group sustainability Allianz SE) who reports directly to Oliver Bäte, CEO
January 2017 with responsibility for management function, which was previously made of Allianz SE. This ensures a close alignment with
Investment Management. up of two Centers of Competence (Allianz4Good the CEO Office. Furthermore, in 2016 the Group ESG
and the Group ESG Office) into a single Corporate Board took on the responsibility for all corporate
Responsibility function. To strengthen the link responsibility and climate-related topics.
24Allianz Sustainability Report 2016 Overview Allianz in the world Managing sustainability Allianz's roles About the report
MANAGING SUSTAINABILITY:
OUR CORPORATE RESPONSIBILITY
GOVERNANCE
DATA AND ASSURANCE COMMITMENT TO SUSTAINABLE
In 2016, our full sustainability report has been DEVELOPMENT PRINCIPLES
assured (limited assurance) by PwC to further Our businesses are signatories to and members of
enhance the quality of our sustainability information a wide range of global sustainability initiatives and
and data. principles, which guide us to:
This will further improve the quality of our reporting • Incorporate best practice sustainable development
and formalize the way sustainability is embedded principles into our activities, products, services
across core functions and business units. Please find and investments;
the assurance report here. In addition we are • Work with and learn from our peers through open
preparing for the upcoming CSR Directive due to be dialogue and knowledge sharing;
incorporated in German law in 2017.
• Collaborate to find solutions that address local
RATINGS AND BENCHMARKS and global challenges relevant to our industry
Our objective is to continuously improve our and beyond; and
performance and to strive for sustainability • Improve transparency in our own operations
leadership in our sector. We see sustainability ratings and across the value chain.
such as the Dow Jones Sustainability Index (DJSI) as Allianz is a signatory of the United Nations
tools to promote transparency and trustworthiness Environment Programme Finance Initiative (UNEP FI)
towards markets and stakeholders. In our role as Principles for Sustainable Insurance (PSI), a working
a Responsible Investor, we rely on these ratings as group dedicated to integrating sustainability into
part of our long-term ESG integration approach investment management.
for proprietary investments, as well as in the
responsible investment products offered to its Allianz SE, Allianz Global Investors (AllianzGI) and
asset management customers. the Pacific Investment Management Company
(PIMCO) are also signatories of the UN-supported
In 2016, Allianz achieved its greatest improvement in Principles for Responsible Investment (PRI), which
the DJSI assessment so far: a +6%-point increase and aim to integrate ESG principles into investment
up from Bronze to Gold in the RobecoSAM Yearbook decisions and management. Together, its network
since the previous year. Since its inception in 1999, of international investor signatories represent
Allianz has been included in the DJSI with top ranking more than 60 trillion U.S. Dollars of assets
positions each year since 2000. under management.
As asset managers, Allianz SE, AllianzGI and
PIMCO also report annually on the progress made
implementing the PRI. You can find our full PSI and
PRI disclosures in our Download Center.
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