Environmental issues at the heart of business leaders’ concerns – report

Only 12% of business leaders across 10 industry sectors in the UK and US ranked environmental concerns – including the pandemic, climate change, environmental damage, food security and energy transition – as their leading risk category in 2021, falling to just 9% looking forward to 2022, according to the study.

Beazley’s research indicated that companies could focus much of their efforts on the interconnected legal, reputational and regulatory risks of compliance with environmental, social and government reporting rather than actively managing environmental risks. Eighteen percent (18%) ranked political and regulatory risks as their top concern in 2021, according to the report.

“The discussions and announcements at the recent COP26 summit demonstrate the growing pressure from stakeholders, government and regulators that companies now face to align their operational practices with the rapidly changing environmental agenda,” said Chris Illman, Head of responsible business at Beazley. “Failure to do so will result in increased legal, reputational and regulatory risk. It is therefore surprising and disturbing that our research reveals that environmental risks rank so low on the list of business leaders’ concerns. »

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Illman said mitigating environmental risk presents a significant challenge for insurers.

“The complexity and interconnectedness of risk has the potential to generate claims that straddle traditional areas – from pollution and environmental damage to new areas of risk like greenwashing and reputational damage,” he said. -he declares. “But they also represent an opportunity for specialist insurers like Beazley to work with their clients to go beyond simple risk transfer to improve risk management and risk mitigation to minimize the likelihood of a claim. “