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What is ESG?

Environmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to determine whether they want to invest in or do business with that company. These criteria may include:

Environmental
Natural resource conservation; carbon footprint/impact on climate change; sustainability initiatives; proper waste disposal/recycling efforts; investments in renewable energy; opposition to deforestation
Environment
Social
Safe working conditions for employees; animal welfare/testing; racial equality issues; LGBTQ+ equality issues; gender equality issues; improved access to education; charitable contributions/donations; impact of product/service on people’s well-being; health insurance offered to their employees; involvement in reducing poverty
Social
Governance
Wages provided to their employees; transparency in their business practices; donations to PACs/political candidates; level of executive compensation; if/how they allow stockholders to vote on issues; number of women on their board of directors; number of minorities on their board of directors
Governance

Why is ESG important?

ESG criteria can help people make better-informed spending and investing decisions by providing transparency into a company’s operations, including its ethical impact and sustainability practices. Increased investor and consumer focus on ESG can in turn help companies understand the role they play in shaping the ecological, social, and economic future of our society.

How has Allianz integrated ESG into our businesses?

Allianz SE, the parent company of Allianz Life Insurance Company of North America (Allianz Life®), aims to lead the industry in integrating ESG factors into their insurance and investment businesses. All ESG integration activities are implemented through company-wide corporate rules on risk management, underwriting, and investment. To learn more about Allianz SE’s approach to ESG, please visit Our ESG approach.

For Allianz Investment Management LLC (AIM) – the investment arm of Allianz Life – ESG is an integral factor behind our corporate citizenship and an important component of the investment platform for AIM across the globe.

AIM’s commitment to ESG investing helps support Allianz Life’s position as a strong and well-capitalized company with the stability to meet our financial obligations. In addition to promoting sustainability, AIM’s focus on ESG also benefits our ability to asses both risks and opportunities in our investment portfolio.

ESG Investor Sentiment Study

Allianz Life developed the ESG Investor Sentiment Study* to discover how typical U.S. investors feel about ESG topics, and what the future of ESG investing may hold.

Although much of the global attention within the ESG sector of investing has been placed on the environmental component, the study revealed that in the U.S., social and governance issues are equally important as – or more important than – environmental record when consumers decide whether or not to invest in or do business with a company. Furthermore, the study found that a company’s ESG profile plays a significant role in its overall reputation, as a majority of consumers believe companies focused on ESG issues have better long-term prospects.

What’s the most important factor for consumer when deciding to do business with a company?

73% Environmental
73% Social
69% Governance

What are the most important issues for consumers when deciding to invest in a company?

22% Environmental
34% Social
27% Governance

71% of consumers

would stop investing in a company if it behaved in ways they consider unethical.