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Sustainability redefined

May 11, 2021.

It’s not just companies that value sustainable management. These days, more and more private investors are expressing an interest in sustainable investment opportunities. Those seeking to achieve a long-term impact should pursue a transparent and holistic approach for sustainable investment solutions. Ralph Schmid, our Chief Life & Pension Officer, talked about Tomorrow Invest, our newly launched sustainable investment plan, in a recent interview.

Climate change, migration, social upheaval, dwindling resources – our society is facing major challenges. What role can the insurance industry play in solving the problem?

The insurance industry has long been grappling with topic of sustainability: we think in the long-term and have to identify potential risks ahead of time. Insurance companies can take action on two key fronts. On the one hand, we insure risks that are becoming more and more difficult to estimate as a result of climate change; on the other, we are major investors and can change a lot by investing sustainably in the long term. This is something our private pension customers should be able to benefit from too.

 

How great is the demand for sustainable investment opportunities among the Swiss?

Today’s investors are no longer just interested in high returns and low risk – they also want to know how sustainable the companies they invest in are. According to the Zug Institute of Financial Services (IFZ) at the Lucerne University of Applied Sciences and Arts (HSLU), only 6% of fund assets are invested sustainably in Switzerland. But, while small, the niche that focuses on environmental, social and governance issues (ESG) is growing quickly. According to an HSLU study, one in four newly invested francs are invested sustainably.

 

Sustainable investments are nothing new. What sets our sustainable investment solution Tomorrow Invest apart from other products on the market?

Of the core products currently offered by Swiss insurers, there are few that adopt a full ESG approach. Existing products often focus solely on environmental factors. But social issues such as equality or working conditions and good corporate governance are just as important. In Tomorrow Invest, we have created an investment solution that is compatible with our unit-linked life insurance policies and incorporates all ESG dimensions.

 

Does this really happen in practice?

Yes, we practice what we preach. We invest exclusively in companies that have been audited by the ESG consultancy agency Sustainalytics, which is one of the world’s leading providers that evaluates companies comprehensively with the regard to the sustainability of their management activities. When it comes to the composition of our funds, we also take into consideration future issues such as data security, offering long-term growth potential for companies involved in this sector. This combination offers strong yield potential and makes the product unique on the market.

 

Are investments restricted to companies that are 100% sustainable?

The definition of sustainability is broad and how it is measured with various standards and labels is a major point of discussion. Generally speaking, there are no companies that are 100% sustainable. What matters is that companies are conscious of their responsibility and promote the concept of sustainability in everything they do.

 

 

Note: This interview appeared in Tagblatt der Stadt Zürich on 14 April.

About the author

Ralph Schmid has been Chief Life & Pension Officer at Generali Switzerland since January 2020. He has many years of international experience in the field of pensions and savings. In recent years, Mr Schmid has held the role of Group Head of Unit-Linked Savings & Pensions at the Generali Group. Prior to that, he spent 12 years in various positions at Generali Switzerland.

Tomorrow Invest

With our investment plan Tomorrow Invest, investors invest in pioneering key sectors and in certified companies with a proven commitment to a better world. And they can look forward to sustainable returns.

 

The benefits

  • Strict selection criteria for sustainable companies
  • More than just “green”
  • Investment in pioneering key sectors
  • Focus on Swiss companies
  • Experts ensure the perfect investment plan composition
  • Cost-effective investment
  • Morningstar Sustainability Rating: 5/5 globes

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