Along with many other countries throughout the world, Malaysia signed the Paris Agreement at the UN Climate Change Conference (COP21) in 2015 and ratified it on 16 November 2016, committing to reduce its greenhouse gas emissions. Insurance is thought to play a key role in transitioning the country’s economy towards a less carbon-intensive business model, as the industry assesses and covers environmental risks and invests in new technologies.
Berjaya Sompo Insurance Berhad (Berjaya Sompo), one of the top general insurers in Malaysia, is committed to ensuring that its business is socially responsible and has embraced the drive and implementation of a more sustainable economy in support of global governments’ environmental, social, and governance (ESG) requirements, as a measure of mitigating risk and generating sustainable long-term outcomes.
A focus on sustainability is essential to Berjaya Sompo’s ability to deliver on its purposes and positively contribute to the economies and communities in which it operates. Its tagline of “Journey to a Sustainable Future” reflects its aspiration to support its clients and society as a whole on their sustainable journeys.
In pursuit of sustainability integration towards achieving the company’s ESG aspirations, a mid-term strategy called the ‘3-year Sustainability Implementation Plan’ was established to align with its Sustainability Framework.
The framework and implementation plan established is in line with global sustainability standards and supports Sompo Holdings’ Group sustainability efforts. In the Malaysian context, Berjaya Sompo also supports the direction and initiatives developed by Bank Negara Malaysia (BNM).
As part of the Malaysian Government’s overall plan to achieve carbon neutrality (or net-zero carbon emissions) by 2050, Berjaya Sompo believes that there are many areas where insurance companies can play a significant role. To that end, Berjaya Sompo has adopted a policy of supporting environmentally friendly business practices. These initiatives include activities such as organising a windscreen repair roadshow for its customers and the public in 2022. The roadshow aimed to raise awareness about environmental issues related to windscreen replacement waste, and to instead promote windscreen repair as a preferable option where possible.
In addition, the company has embarked on a slope mitigation initiative together with Global Environment Centre, and in partnership with the Department of Irrigation and Drainage Gombak, Department of Orang Asli Development Gombak and Petaling District, Jungle School Gombak Malaysia, and Friends of Sungai Gombak Batu 12 at Kampung Batu 12, Gombak.
The initiative, called the “River Slope Mitigation through Tree Planting to Protect Water Resources at the Klang River Basin” initiative, kicked off with over 40 volunteers from both Berjaya Sompo and local indigenous community members coming together to plant over 730 trees, including species such as Melastoma malabathricum (pokok senduduk), Dillenia suffruticosa (pokok simpoh air) and Saraca thaipingensis (pokok gapis), as well as erosion control plants like Chrysopogon zizanioides (vetiver) and Schizostachyum jaculan (buluh termiang) at the Gombak River slope at Kampung Batu 12. Additionally, the Orang Asli communities will be involved through the Friends of Sungai Gombak Batu 12 platform to monitor the river and the trees planted.
Berjaya Sompo has also partnered with its bancassurance (insurance sales through the banking channel) partner CIMB Bank to offer complimentary EV (electric vehicle) coverage through Secure Motor. Both new and existing EV cars (of up to 8 years of age) can be covered under Secure Motor. This complimentary EV coverage includes legal liability of passengers, legal liability to passengers, unlimited towing costs, personal accident coverage up to RM100,000, EV home wall charger coverage up to RM15,000, personal liability up to RM50,000, and loss of use up to RM1,000. Berjaya Sompo has also partnered with Mazda for similar coverage.
The company believes these efforts are important for the Malaysian economy as they enhance resilience, support the economy’s transition to clean and renewable energy, and contribute to long-term economic stability. For consumers, insurance companies can further provide financial protection, instil sustainable behaviour, and raise awareness about climate change and its associated risks, empowering individuals to take proactive steps towards a more sustainable future.
For its part, Berjaya Sompo has had (and continues to have) a collaboration with an automotive treatment facility company (ATF) to scrap written-off vehicles since August 2020. The process involves reusing and recycling vehicle parts and components, while also regulating the use of hazardous or toxic materials to prevent adverse impacts on the environment. At present, Berjaya Sompo disposes of actual total-loss vehicles to the ATF.
Furthermore, Berjaya Sompo’s underwriting guidelines have been updated to integrate the climate change principle-based taxonomy classification and natural disaster protection. In this manner, Berjaya Sompo is able to incorporate and consider climate-related risks and opportunities in its business.
Additionally, Berjaya Sompo also continues to restrict its activities in terms of investing in and the insuring of new construction of coal-fired power plants, in order to curb the production of greenhouse gas emissions while shifting towards energy business projects that result in a lower environmental impact.
Berjaya Sompo’s sustainability initiatives encompass its own activities and impact, as well as those of its value chain partners and customers. For instance, the company’s headquarters have completed its transition from traditional and fluorescent lighting to LED lights, which is expected to reduce the company’s energy costs by at least 60% annually. Furthermore, the longer lifespan of LEDs leads to fewer light bulb replacements over time, which in turn reduces waste.
Additionally, Berjaya Sompo is cognisant of the impact that its operations – specifically, the energy consumed to run its operations – has on carbon emissions and has undertaken several initiatives to improve its operations. From a process optimisation and digitisation/digitalisation perspective, Berjaya Sompo credits a range of strategic initiatives driven by innovation, customer-centricity, and continual improvement with having propelled its growth and strengthened its position in the insurance market.
Two key drivers of this success are the introduction of market-relevant products and adoption of digital processes for its customers’ convenience. This includes the launch of innovative products such as SOMPO MotorSafe, a usage-based telematics motor insurance coverage providing low-mileage drivers the flexibility of paying according to the distance driven. Aside from easing the financial burdens of the community, driving less also promotes the reduction of carbon emissions.
Berjaya Sompo’s dedication to embracing digitalisation as a part of its growth strategy is further demonstrated in the recent launch of the MySOMPO mobile application, demonstrating the Company’s commitment to enhancing customer experience and convenience. MySOMPO provides a user-friendly platform for policyholders to request assistance in case of a vehicle breakdown or accident, and to submit claims electronically. Since its launch on 20 March 2023, MySOMPO has seen more than 4,000 downloads.
Berjaya Sompo realises that speed is essential in most aspects of the insurance business. Hence, the company continually improves its processes to optimise internal processes, eliminate redundancies, and enhance operational effectiveness. As a result, Berjaya Sompo has achieved greater agility, responsiveness, and cost-efficiency, benefitting both the organisation and its customers. When it comes to exchanging data to inform risk insights and improve understanding across the sector, the company closely adheres to the guidelines provided by BNM when it comes to data management, in addition to strictly complying with the Personal Data Protection Act (PDPA).
Berjaya Sompo’s achievement of RM1 billion in gross written premiums (GWP) for financial year 2022 illustrates its market leadership and customers’ trust in the company. As Berjaya Sompo moves forward, it remains focused on driving innovation, leveraging digital technologies, and adopting sustainable business practices to ensure a positive impact on its customers, employees, and the communities it serves.
Moving forwards, Berjaya Sompo will focus on initiatives and programmes that address environmental concerns, promote social well-being, and uphold strong governance practices, guided by its Board-approved Sustainable Framework. Berjaya Sompo is dedicated to spearheading initiatives and programmes that align with the United Nations Sustainable Development Goals (SDGs). Specifically, the company has chosen to champion SDG 3 (Good Health and Well-being), SDG 4 (Quality Education), SDG 8 (Decent Work and Economic Growth), SDG 13 (Climate Action), SDG 16 (Peace, Justice and Strong Institutions), and SDG 17 (Partnerships for the Goals).
Berjaya Sompo is also a firm believer that the company itself – and its employees should take the first step when it comes to climate change. Berjaya Sompo actively advocates sustainable living amongst its staff by organising internal campaigns and competitions themed around ESG. Some of the initiatives include the Plant Babies Contest, which encourages its staff to start planting potted plants and share how plants contribute to the ‘Innovation of Wellbeing’. Berjaya Sompo also collaborated with AIESEC at the University of Malaya to conduct a virtual workshop on how to make compost. The workshop was part of AIESEC’s ‘Clean Our Plate’ Campaign aiming to increase awareness, change attitudes, and initiate easy and obvious actions toward reducing food waste, in line with United Nation’s Sustainable Development Goal (“SDG”) pillars 4 – Quality Education, 12 – Responsible Consumption & Production and 3 – Good Health and Well-being.
Communications, campaigns, and awareness activities are also shared through internal newsletters, through which the company hopes to influence its employees’ behaviour and mindset. This includes encouragement to use their shopping bags and energy-efficient appliances at home, and cultivating a recycling or repurposing habit, amongst other ESG-related news.
To further elevate Berjaya Sompo’s “Journey to a Sustainable Future”, the company is taking a step forward with its ‘The Good Policy’ campaign, which seeks to improve the lives of those in need, in line with the group’s vision and mission. The campaign underlines the company’s commitment to safeguarding its customers and the future of Malaysia by addressing ESG challenges through various initiatives, including ‘The Good Bengkel’, which is aimed at helping the B40 community facing financial challenges related to vehicle maintenance.
