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Corporate Responsibility in investment

Download CR Report 2020, p. 37
Because our business model as an insurer has a long-term focus, sustainability criteria in investment play a key, strategic role. Since as an insurance company, we must invest our clients’ money sensibly and profitably, we are subject to strict security and return requirements. For our investments, just as with our insurance business, we regard it as essential to consider ESG aspects and to offer responsible products and services.

Management of our investments is based on three pillars

1.
Systematic integration of ESG criteria
2.
Investment focus topics (for example renewable energies)
3.
Defined exclusion criteria
The Principles for Responsible Investment (PRI) provide a framework for sustainable action in the field of investment. In order to ensure that we adhere to our sustainable investment approach, we established a binding Group-wide Responsible Investment Guideline (RIG), which covers all requirements regarding PRI and ESG that concern Munich Re Group asset management, especially on the subject of exclusion criteria for investments.

Sustainability criteria firmly anchored in the investment process

Our aim is to invest the bulk of our assets sustainably. The target achievement is measured on the basis of internal sustainability reporting (sustainability ratio). Individually defined ESG criteria are incorporated into the selection process for all classes of assets. An overview of the individual investment segments and their focus on sustainability you will find in our Corporate Responsibility Report.

Our investments: Focus on renewable energies

Through our investments, we aim to promote the use of future technologies in avoiding greenhouse gas emissions. With this in mind MEAG, on behalf of Munich Re, invests in infrastructure projects around the world such as solar power plants and wind farms as well as green bonds. In 2020, invested capital (equity and debt) in renewable energies was approximately €1.6bn and will be steadily increased over the next few years to €3bn. Investment in green bonds amounted to approximately €1.85bn. 

Overall, Munich Re invested around 1.4% (1.2% in 2019) of its total investments in renewable energies and green bonds at the end of the financial year. We continue to rely heavily on regional and segment-specific diversification of these investments in order to spread the technical and political risks within the portfolio. In 2020 our installations generated approximately 2.9 million megawatt hours of green electricity, supplying power to around 700,000 households, thereby avoiding some 800,000 tonnes of CO2 equivalents. 

Floating solar panels or solar cell platform on the lake
© Tomwang112 / iStock / Getty Images Plus
Floating solar panels on the lake
2.9
million MWh green electricity generated from our investments
700,000
households supplied with green electricity
800,000
tonnes of CO2 avoided

Munich Re´s first green bond

In 2020, as the first German insurer, Munich Re issued a green bond with a volume of €1.25bn to further strengthen our commitment to creating positive impact. As part of the bond issuance, we committed ourselves to investing the volume issued in sustainable projects in accordance with the Green Bond Framework. When selecting the projects, we were guided by the UN Sustainable Development Goals. We have specified a time horizon of 36 months in this regard and will publish information about the investments made in an allocation report on our homepage. We intend to invest the volume issued in projects that are diversified geographically and across the alternative asset classes.

Corporate Responsibility Report

In our Corporate Responsibility (CR) Report, we describe the ways in which we embrace corporate responsibility in our day-to-day operations.

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