The Chartered Insurance Institute (CII) has published a guide to better inform small and medium sized (SME) brokers of environmental, social and governance (ESG) issues.
The launch follows research carried out by the 2022/23 CII Broking Community New Generation group which found that while most larger brokers already have an individual or committee within their organisation that is responsible for considering ESG, the same could not be said for SMEs.
The research also revealed that understanding of ESG targets was not consistent across employees. Both larger firms and more senior staff significantly are more likely to have a meaningful understanding of their targets than those in entry or intermediate level roles or at SME brokerages.
According to the findings, less than a quarter of entry level employees felt confident in their understanding of ESG targets, and over a third of those surveyed had no understanding. Less than a third (32%) of those at small brokers understood the ESG targets at their firm.
Larger brokers were also shown to be more actively considering diversity in recruitment, with only 11% of respondents disagreeing that their company ‘actively considers diversity when recruiting’. This compared to 23% of respondents from small brokers.
But the data showed there is still work to be done across the industry in this area, with 22% of research participants feeling that their board is not diverse at all.
Consequently the group made a number of key recommendations including:
- Implementing an individual or committee responsible for considering ESG within your business.
- Introducing workplace environmental benefits such as electric car leasing/charging and participation in cycle2work schemes.
- Avoiding ‘Tokenism’, instead focusing on making small and gradual changes that will improve the business culture and practices in the long-term.
- Working with an external HR adviser to ensure traditional biases are avoided during the recruitment process and interview stage.