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This article originally appeared in the Economic Vision 2023 (Pg 50-51)
Over the past years, ESG and Sustainability have become familiar terms as the world is understanding better the need to have business practices and stakeholder alignment in order to contribute to the wellbeing of the planet and the people living on it. Atlas Insurance is one such business that is placing ESG at the heart of the way it operates. We caught up with Catherine Calleja, Director and Company Secretary of Atlas Group of Companies, who explained the company’s vision and plan for a sustainable future and the structured way the company is investing in the community.
Why is ESG becoming an ever more important aspect of the way companies do business? Why is Atlas placing such high importance on ESG?
Simply put, ESG is a way of assessing companies on their environmental, social and governance performance while also considering financial returns. It is fast becoming a measure by which a company’s success is defined and which enables investors to evaluate businesses in which they want to put their money.
This consideration is a modal shift which prioritizes the purpose of what an organisation does over its financial performance. At Atlas, our “purpose beyond profit” has been part of our vision statement for the past decade. ESG is central to our identity and is increasingly important for our stakeholders, especially our staff members – TeamAtlas.
Under the European Union’s Corporate Sustainability Reporting Directive (CSRD), initially larger companies, and eventually almost 50,000 EU companies will need to publish regular reports on their sustainability related activities. This will require ‘double materiality’ which means that we will need to disclose not only the risks we face but the impacts we may cause to the climate and to society. Data will need to be submitted in a standardised manner which will allow our stakeholders to compare us with our peers. We want Atlas to be at the forefront of the road to sustainability not just because we have to report but because our stakeholders are demanding this.
We also believe that ESG practices at Atlas are intrinsically linked to mental and physical wellbeing. In this space, Atlas has also been very active through its initiatives spearheaded at The Malta Chamber as well as initiatives like the Mental Health Awareness Month, which we organise every year in October.
What has Atlas been doing in terms of ESG?
Over the past two years Atlas has developed a concrete ESG strategy with objectives and quantified key results and targets. We have set up an ESG cross functional team which is spearheading the different initiatives such as putting into action our decarbonisation plan, allocating funding through our Atlas Insurance Community Involvement project, sustainability training for our stakeholders, reduction of the use of paper and so on.
As insurers, the management of risk is fundamental to our business and the identification of the company’s ESG risks, including climate change risks and mitigation plans are also important. We have reviewed our internal processes, and established roles and responsibilities in relation to ESG. In other words, we have endeavoured to adopt a strategic approach with the support from the top and with staff involvement. This team reports on quarterly basis to the board on the ESG key results through the Risk and Compliance committee.
How does an organisation like Atlas, together with its stakeholders – especially TeamAtlas, embrace sustainability and carbon neutrality as a way of life?
As I said earlier, the involvement of staff and other stakeholders in this journey is key. To achieve our decarbonization targets, we have calculated our carbon footprint and are investing heavily to reduce it. A substantial investment in additional PV panels has been made with installation over the coming months
Insurers are also institutional investors and management of our investment portfolio is a major way we can influence sustainable practices also internationally. We closely monitor the rating of our securities to ensure an increasing proportion has positive ratings on international ESG indices.
Equally important is the collaboration within the local insurance market on climate change awareness and climate change adaptation, which is particularly important in our industry. The development and enforcement of standards in many areas will become increasingly importance as we start to see the increasing effects of climate change and, particularly, extreme weather events.
Why is Atlas’ Community Involvement Strategy key to ensure the positive impact of its funding programme? How is Atlas contributing to support the communities it operates in?
In order to ensure that the money we give to the community is put to the best possible use, we have developed a strategic approach to giving. Through this fund we are focusing our efforts in specific areas – where Malta is falling short of its Sustainable Development Goals (SDGs) – all of us should be aware of our national progress in these key areas and this site makes a very interesting read: https://dashboards.sdgindex.org/profiles/malta. We approached several research organisations, NGOs and other stakeholders who can make a difference in the areas of zero hunger, quality education, achieving gender equality and empowerment of women and girls, responsible consumption and production, clean water and sanitation and climate action. We have received a number of extremely interesting proposals and 2023 will be a key year of implementation of the first three funding projects under this new programme.