Nongovernmental organizations (NGOs) have rated Japanese insurers low in terms of their contributions to environmental and human rights protection in a recently launched project to assess if these businesses are extending loans and investments for such issues.
The project is part of the Fair Finance Guide, an international campaign to enhance insurance policyholders' interest in insurance companies' investment and loan policies and to help stop the provision of financial resources for business activities that could lead to environmental destruction and human rights violations.
In the project, multiple Japanese NGOs assessed efforts made by five major life insurance groups -- Nippon Life Insurance Co., Dai-ichi Life Holdings Inc., Meiji Yasuda Life Insurance Co., Sumitomo Life Insurance Co. and Japan Post Insurance Co. -- as well as three leading nonlife insurance groups -- Tokio Marine Holdings Inc., MS & AD Insurance Group Holdings Inc. and Sompo Holdings Inc.
Specifically, the NGOs rated these insurers for 306 items in 16 categories, including their contributions to the prevention of climate change, relations to the weapons industry, corruption and gender, each on a scale of one to 10. Their investment and loaning policies and practices were assessed in light of universal criteria that the NGOs participating in the Fair Finance Guide campaign worked out based on U.N. and other rules. This is the first time that Japanese insurance companies have been covered by the project.
In the latest evaluation, MS & AD gained the highest average score at 2.4. The NGOs highly appreciated policies the company has adopted on corruption and human rights in line with U.N. principles.
MS & AD was followed by Sompo, which was appreciated for its transparency, and Tokio Marine. Nippon Life and Dai-ichi Life came in fourth, both gaining the same score. Dai-ichi Life gained extra points in climate change for its declaration that it will withdraw from participating in coal-fired thermal power generation projects overseas.
The average score that the eight companies gained in the 16 categories was only 1, far below 5.1 in the Netherlands, where the Fair Finance Guide campaign was launched in 2009.
An individual linked to the insurance industry appreciated the project, which the person said will help the public and businesses "increase their understanding of what is valued in the international community."
Another person in the industry said insurers did not rank well because they set investment and loaning policies only in their internal rules and did not disclose relevant information in a way that would be understood by NGOs.
Members of the general public can examine the breakdown of scores and can push a "like," "dislike" or "change" (to other companies enthusiastic about addressing such social issues) button, thereby sending messages to the companies concerned.
Yuki Tanabe, a board member at the Japan Center for a Sustainable Environment and Society that is involved in the project, said, "We'll also look into the gap between financial institutions' policies on investments and loans and their actual business practices. We hope that businesses will fully implement their policies and their practices will be reflected in their scores."
The website showing the NGOs' ratings of these eight Japanese insurers can be viewed by visiting https://fairfinance.jp/
(Japanese original by Satoko Takeshita, Tokyo Business News Department)