Climate Change Data

Environmental Metrics

ESG Focus Areas

• Decarbonisation
• Climate Change
• Supply Chain Sustainability
• Diversity and Inclusion

Environmental Achievements

• Supported the development of parametric insurance products for flood, wildfire, and other climate-related risks.
• Facilitated the creation of a Global Health Risk Facility (GHRF) to insure the transport and storage of COVID-19 vaccines in developing countries.
• Partnered with ICEYE to provide access to flood hazard analysis for the entire market.
• Supported the development of carbon risk rating methodologies for large industrial conglomerates.

Social Achievements

• Created over 1,000 jobs through its alumni network.
• Supported the development of insurance products addressing social issues such as fertility treatment and access to insurance for vulnerable communities.
• Facilitated the insurance of grain shipments from Ukraine, helping to avert a global food crisis.

Governance Achievements

• Established a partnership-powered ecosystem to accelerate the adoption of new ideas and products.
• Implemented the ICX class, providing additional capacity for innovative businesses.
• Supported the development of technology solutions to improve efficiency and transparency in insurance processes.

Climate Goals & Targets

Environmental Challenges

• Lack of data for pricing innovative insurance products.
• Difficulty in accessing insurance for emerging risks and in underserved markets.
• Need for faster claims processing and automation.
• Challenges in measuring and reporting supply chain emissions.

Mitigation Strategies

• Developed collaborative partnerships between insurers, brokers, and insurtechs.
• Leveraged data-driven approaches and AI to improve risk assessment and claims processing.
• Created new parametric insurance products to address protection gaps.
• Developed technology solutions to track and report supply chain emissions.

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Floods
• Wildfires
• Hurricanes

Opportunities

• Development of new insurance products and services to manage climate-related risks
• Opportunities for green innovation

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)
• Goal 2 (Zero Hunger)
• Goal 3 (Good Health and Well-being)

Initiatives contribute to these goals through the development of sustainable insurance products and services, support for climate change mitigation and adaptation, and facilitation of access to essential goods and services.

Sustainable Products & Innovation

• Parametric insurance products for climate-related risks
• Global Health Risk Facility for vaccine distribution

Environmental Metrics

ESG Focus Areas

• Climate Change
• Social Equity
• Resilience

Environmental Achievements

• Not disclosed

Social Achievements

• Not disclosed

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Climate change impacts (sea-level rise, extreme weather events)
• Social unrest and inequality
• Cyberattacks and technology risks
• Financial instability (market crashes, sovereign defaults)
• Geopolitical tensions
• Pandemic risks
• Water scarcity
• Underinsurance of cities

Mitigation Strategies

• Development of insurance solutions for various risks (political risk, natural catastrophes, cyber risks, financial risks)
• Risk transfer mechanisms
• Data sharing and analytics to improve risk management
• Cross-sector learning and collaboration
• Improved risk preparation and mitigation measures
• Meeting customer needs through product development
• Increased understanding of risk consequences
• City-level resilience strategies (e.g., Resilient305, London City Resilience Strategy, CDMX Resilience Strategy)
• Investment in infrastructure modernization and climate adaptation

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Flooding
• Hurricanes
• Sea-level rise
• Heat waves
• Droughts

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of climate-resilient infrastructure
• Growth of renewable energy sector

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Parametric insurance solutions

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate Change

Environmental Achievements

• Allocated 5% of the Corporation of Lloyd’s Central Fund to impact investments by 2022
• Phased out new investments in thermal coal-fired power plants, thermal coal mines, oil sands and new Arctic energy exploration activities

Social Achievements

• Convened a workstream dedicated to establishing a public-private disaster resilience, response, and recovery framework to help protect developing nations

Governance Achievements

• Developed guidance on impact investing to support participants in the Lloyd’s market to create their responsible investment strategies

Climate Goals & Targets

Environmental Challenges

• Lack of historic data for new materials in construction, hindering insurance coverage.
• High upfront costs and long construction timelines for nuclear power plants.
• Variability in electricity generation from wind energy.
• Lack of infrastructure to support hydrogen economy.
• Safety risks associated with hydrogen transportation and storage.
• COVID-19 impact on aviation sector's ability to invest in new technologies.

Mitigation Strategies

• Collaboration between Lloyd's and Marsh to scientifically assess risks of new construction materials.
• Exploring new financing models for nuclear projects (e.g., RAB model).
• Providing parametric cover to mitigate wind energy variability risks.
• De-risking investment in hydrogen infrastructure through insurance products.
• Developing global best-practice guidelines for hydrogen safety risks.
• Adjusting CORSIA baselines to account for COVID-19 impact on aviation.

Supply Chain Management

Responsible Procurement

• Developing and launching an industry-wide framework for greener insurance supply chains

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Natural catastrophes

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of new risk transfer solutions for green innovation
• Investment opportunities in green assets

Environmental Metrics

ESG Focus Areas

• Sustainability
• Resilience
• Inclusivity

Environmental Achievements

• 100% Electricity and gas consumption for London office from renewable sources
• 16% decrease in global emissions per FTE since 2021
• 19% reduction in scope 1 emissions
• 11% reduction in location-based emissions from electricity in scope 2
• 44% decrease in global emissions per full-time employee since our baseline 2019
• Achieved 2025 goal to phase out Central Fund’s exposure to investments relating to coal-fired power plants, coal mines, tar/oil sands and Arctic drilling two years ahead of schedule.

Social Achievements

• Launched Lloyd’s of London Foundation, providing nearly £2 million of financial support in 2022 to help 100,000 people around the world
• Supported the British Red Cross’ Ukraine Crisis Appeal and matched employee donations
• Supported Habitat for Humanity’s Ukraine Crisis Appeal, helping 32,000 refugees
• Established the Black Sea Grain Facility, enabling the export of over 2 million tonnes of grain and fertiliser from Ukraine’s ports
• Women in leadership positions across the market increased to 30%
• 5% rise in ethnic minority talent across the market
• Achieved Clear Assured Gold Standard in Equity, Diversity and Inclusion
• Top 75 Employer in Social Mobility Foundation’s Employer Index
• Recognised employer under UK Government’s Disability Confident scheme
• Launched insurance industry-wide LGBTQ+ mentoring pilot
• Provided two one-off payments to all colleagues with a base salary of £75,000 or less to help address rising living costs.

Governance Achievements

• 75% of Boards have Culture as an agenda item
• Published guidance on establishing a sustainability framework for managing agents
• Collected information on the market’s sustainability strategies for the first time
• Provided tailored feedback to managing agents to support their development of future sustainability plans and priorities

Climate Goals & Targets

Environmental Challenges

• Increase in business travel and employee commuting post-COVID-19 restrictions leading to increased Scope 3 emissions.
• Significant remodeling of UK office sites resulting in a spike in waste and recycling emissions.
• Majority of emissions are due to Scope 3 financed emissions.

Mitigation Strategies

• Discussions to make environmental efficiencies and adaptations to the building to further reduce energy consumption.
• Focus on reducing carbon emissions associated with investments in 2023 and beyond.
• Working with managing agents to execute their own sustainability strategies.

Supply Chain Management

Responsible Procurement

• Global Supply Chain Pledge

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products
• Growth in climate-related insurance products

Reporting Standards

Frameworks Used: UN Sustainable Development Goals, ClimateWise, UN Global Compact, TCFD

Certifications: Clear Assured Gold Standard in Equity, Diversity and Inclusion

UN Sustainable Development Goals

• 1
• 2
• 3
• 4
• 5
• 7
• 8
• 10
• 11
• 13

Lloyd's aligns its strategy to the UN Sustainable Development Goals, highlighting progress throughout the report.

Sustainable Products & Innovation

• Parametric insurance products
• Carbon Purchase Protection Cover

Environmental Metrics

ESG Focus Areas

• Sustainability
• Resilience
• Inclusion

Environmental Achievements

• 33% reduction in global carbon emissions per FTE since 2019
• 100% of electricity purchased for London and Chatham office is renewable

Social Achievements

• 2.1% decrease in Corporation’s gender pay gap from 2022
• Exceeded 35% target for female leadership in the Corporation (38%)
• Reached 35% target for female leadership in the market
• Launched Inclusive Futures programme with an initial investment of £50m

Governance Achievements

• Launched a consultation on a three-year roadmap to chart the market’s path to support the global transition to a lower carbon economy
• 9% of Executive remuneration weighted to key performance indicators for Lloyd’s purpose, which encompasses our sustainability strategy

Climate Goals & Targets

Environmental Challenges

• Data availability and data quality challenges in emissions accounting, particularly for Scope 3 emissions.
• Need to support market participants in evolving and embedding their own sustainability strategies.

Mitigation Strategies

• Collaboration with Moody’s Analytics to develop an emissions accounting solution.
• Development of a three-year roadmap for insuring the transition, providing tools and guidance to market participants.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct

Climate-Related Risks & Opportunities

Physical Risks

• Increased frequency and severity of natural catastrophes

Transition Risks

• Regulatory changes, market shifts

Opportunities

• Development of energy-efficient products and services
• Growth in renewable energy insurance

Reporting Standards

Frameworks Used: TCFD, UN SDGs, ClimateWise, UN Global Compact, GHG Protocol, SECR

Third-party Assurance: PricewaterhouseCoopers LLP

UN Sustainable Development Goals

• 5
• 7
• 8
• 9
• 10
• 11
• 13

Aligned with strategic priorities and where we can make the most impact.

Sustainable Products & Innovation

• Carbon credit insurance solution (Oka)

Awards & Recognition

• Diversity & Inclusion Award for LGBTQ+ mentoring programme