Zurich Insurance Group Ltd · SIX:ZURN
Zurich Insurance — Non-Deal Roadshow (November 2023)
44 slides from Zurich Insurance's roadshow presentation, November 2023
Slide 1: Chairman's Roadshow
2023-2024 Chairman’s Roadshow Michel Liès, Chairman of the Board November 2023 Investor presentation Zurich Insurance Group © Zurich
Slide 2: Content
Content Strategy 3 People and operations 24 Corporate Governance 8 Communities 30 Remuneration 11 Responsible Investments 32 Our ESG approach 16 Sustainable Insurance 37 November 2023 2023-2024 Chairman's Roadshow 2 © Zurich
Slide 3: Strategy
Strategy © Zurich
Slide 4: Key messages
Key messages We are on track to deliver on our 8% EPS growth target, underpinned by P&C top-line growth, improved margins in Earnings growth Retail, growth in preferred lines in Life, Farmers Exchanges1 turn-around and expense discipline Successful strategy The Swiss and German business units showca
Slide 5: Continuing to pursue our strategic vision established in 2016
Strategy Continuing to pursue our strategic vision established in 2016 Consistent strategy Financial targets for 2023 – 20251 Deliver cross-cycle outperformance in Commercial based on technical excellence and opportunistic growth BOPAT ROE2 >20% Accelerate customer loyalization in Retail through rel
Slide 6: Profit growth driven by P&C top-line and retail margin recovery, continued growth in Life
Strategy Profit growth driven by P&C top-line and retail margin recovery, continued growth in Life and expense efficiency EPS growth over the cycle (USD) Growth drivers Upside • P&C Retail: customer value initiatives and rate increases • P&C Commercial: top line growth in middle market and Contribut
Slide 7: We are focused on continuing to reward our shareholders
Strategy We are focused on continuing to reward our shareholders Dividend policy1 Earnings and dividend per share EPS growth target3 +8% p.a. +5% p.a. NIAS2 payout ratio of ~75% 40.4 34.7 32.13,4 27.7 25.6 22.0 24.0 20.0 20.0 Dividend increases based on sustainable earnings growth FY-19 FY-20 FY-21
Slide 8: Corporate Governance
Corporate Governance © Zurich
Slide 9: A diverse and independent Board, well positioned to support management delivery
Corporate Governance A diverse and independent Board, well positioned to support management delivery on strategic priorities Board composition1 Board by length of tenure Singapore 7% Germany 20% Switzerland Male 40% 50% 50% 50% 50% Female 7% UK < 5 years 5-10 years 20% 7% U.S. Luxembourg Board by ba
Slide 10: Board leadership and commitment to key strategy and policy issues
Corporate Governance Board leadership and commitment to key strategy and policy issues Key focus areas in 2022-2023 2022 Board meeting attendance 1 Board 96% Strategy: continued analysis of customer needs and Audit Committee 96% development of innovative insurance and service Risk & Investment Commi
Slide 11: Remuneration
Remuneration © Zurich
Slide 12: Significant portion of remuneration is deferred for senior management
Remuneration Significant portion of remuneration is deferred for senior management 2022 remuneration structure1 Fixed remuneration / fees Directors CEO • Base salary benchmarked towards relevant market median • Pensions and benefits in line with relevant market practice – benefits 29% can include li
Slide 13: Zurich has created significant value for shareholders
Remuneration Zurich has created significant value for shareholders Total shareholder return (USD since Jan 1, 2016)1 Dividend per share (CHF) 350% 307% 300% CAGR +6% 24 250% 22 20 20 19 178% 18 200% 17 176% 150% 100% 50% 0% FY-16 FY-17 FY-18 FY-19 FY-20 FY-21 FY-22 2016 2017 2018 2019 2020 2021 2022
Slide 14: ExCo STIP metrics support Group strategy
Remuneration ExCo STIP metrics support Group strategy 2023 ExCo STIP funding 2023 CEO target card framework Financials 40-50% Customers 40% Employees 10 - 20% BOP 100% + Consideration of execution against strategic priorities, including ESG factors and a risk-based review 2022 ExCo STIP funding achi
Slide 15: LTIP metrics reflect strategic ambition and priorities
LTIP metrics reflect strategic ambition and priorities 2023 LTIP vesting determination for 2020-20221 LTIP targets for 2023-2025 performance period 0% 50% 100% 150% 200% Weight 0% 50% 100% 150% 200% Weight Relative TSR 6th – 4th 150% Relative TSR 7th – 9th 33% 30% Average NIAS ROE <14% - < 15.1% 123
Slide 16: Our ESG approach
Our ESG approach © Zurich
Slide 17: Our ESG approach is driven by sound risk management, societal expectations and regulation
Our ESG approach Our ESG approach is driven by sound risk management, societal expectations and regulatory and transparency requirements Risk management Societal expectations Regulators and transparency Deploy effective risk management in order Support the social transformation resulting Increased r
Slide 18: Our materiality assessment helps us to prioritize sustainability risks
Our ESG approach Our materiality assessment helps us to prioritize sustainability risks and shape our strategic competitive response Zurich’s materiality matrix Investors’ top 5 issues3 Shaping our competitive Moderate High Very high Data privacy & security Climate resilience response & adaptation D
Slide 19: Sustainability framework underpinned by qualitative ambitions and quantitative targets
Our ESG approach Sustainability framework underpinned by qualitative ambitions and quantitative targets Customer: Support transformation Planet: Mitigate and adapt to People: Future proof our people towards a sustainable future climate change and enable more to thrive Net-zero operations by 2030, in
Slide 20: We deploy AI to improve customer service, while mitigating risks
Our ESG approach We deploy AI to improve customer service, while mitigating risks through our own AI Assurance Framework Our general approach Existing 140 AI use cases at Zurich • Zurich’s AI Assurance Framework (AIAF) is a risk-based approach implemented in line with market and regulatory Claim pro
Slide 21: Solid ESG governance in place to secure execution
Our ESG approach Solid ESG governance in place to secure execution Sustainability management embedded across our organization ESG in remuneration • GNSC1: oversight of sustainability strategy and objectives Long-term incentive plan (LTIP)2 Board All Board committees • Audit committee: supervision of
Slide 22: We continuously enhance our ESG reporting
Our ESG approach We continuously enhance our ESG reporting in line with regulatory requirements and our transparency ambition Group 20211 2022 2023 2024 level • Launch Integrated Sustainability • ISD enhancements • Compliance with new requirements TCFD becomes Disclosure (ISD) based on SASB • Reason
Slide 23: Our ESG performance has been recognized by external assessors
Our ESG approach Our ESG performance to date has been recognized by external assessors Our ESG ratings Our commitments ‘AAA’ rating1 Prime status C+2, Decile rank: 1 Absolute score of 3.9 (out of 5.0)3 ‘A’ Leadership Level4 1 MSCI ESG Rating Report, October 2023. For more • A guide to ESG at Zurich
Slide 24: People and operations
People and operations © Zurich
Slide 25: We embrace diversity and inclusion in our businesses around the world
People We embrace diversity and inclusion in our businesses around the world Employees by gender and female representation Organization footprint North America EMEA Asia Pacific Employees1 19,929 24,641 6,984 Board of Directors 60,654 HY-23 50% 48% Male 50% 2022 CC Female 1,686 52% 2021 55% 2023 202
Slide 26: We sustain an engaging work environment and prioritize workforce development
People We sustain an engaging work environment and prioritize the continuous development of our workforce New Zurich Experience survey Internal hires Learning and development Senior Management Learning hours (‘000)3 82% Group-wide 1,158 response HY-23 88% 851 rate 524 620 451 2022 86% 280 400 634 Co
Slide 27: We remain committed to people sustainability
People We remain committed to people sustainability Aspiration Priorities Approach • Accelerate potential and careers Continue to prioritize through skills-based learning and internal over external hiring development • Strengthen internal marketplace to provide targeted opportunities Support long-te
Slide 28: We deliver on our ambitious operational targets through a variety of initiatives
Operations We deliver on our ambitious operational targets through a variety of initiatives Delivering on our ambitious targets Initiatives -70% 181 • Purchase of 100% renewable power across all operations including data Targets1 centres achieved in 2022; member of RE100 initiative; Scope 1 24 • Sus
Slide 29: We have established a sustainable sourcing program
Operations We have established a sustainable sourcing program to enable a net-zero aligned value chain Encouraging Code of Decarbonizing our supply-chain Net-zero training and tool for carbon Conduct compliance accounting 2022 target 2025 target 2030 target 75% of managed procurement 75% of managed
Slide 30: Communities
Communities © Zurich
Slide 31: Zurich Z Foundation's strategic pillars address major global issues
Communities Zurich Z Foundation’s strategic pillars address major global issues for which we have a expertise and infrastructure Adapting to climate change Improving mental wellbeing A decade of experience and proof-points: Building global expertise and proof-points: • Flood Alliance currently suppo
Slide 32: Responsible investment
Responsible investment © Zurich
Slide 33: Our responsible investment strategy and ambition
Responsible investment Our responsible investment strategy and ambition - leveraging our role as an investor Responsible investment Strategy based on three pillars Defined focus areas Net-zero journey Reducing financed emissions and financing climate solutions ESG integration Impact investing Mitiga
Slide 34: Our approach to net-zero in investments by 2050
Responsible investment Our approach to net-zero in investments by 2050 Current targets Comments • Reduce Corporate Bonds and equities emission Reduction of financed intensity by 25% by 2025 • Expanding scope to sovereign bonds and • Reduce Real Estate emission intensity by 30% private asset classes
Slide 35: Delivering on our Responsible Investments commitments
Responsible investment Delivering on our Responsible Investments commitments Investments relative emission intensity1 Impact Investments Engagement with investees2 (USDbn) 4% -11% 3% 7.0 Target: 65% 236 209 6.3 Collectively 25% 29% Bilaterally 2019 baseline 2022 Corporate Bonds Listed Equities 54% 2
Slide 36: Challenges in pursuing a net-zero investment portfolio
Responsible investment We are confronted with multiple challenges as we pursue our ambition to transition to a net-zero investment portfolio Externalities Measurement Portfolio construction Risks • Reliance on transition in real • Corporate emissions: • Reduction in investable universe • Stranded as
Slide 37: Sustainable insurance
Sustainable insurance © Zurich
Slide 38: Our approach to net-zero in underwriting by 2050
Sustainable insurance Our approach to net-zero in underwriting by 2050, interim targets to be set by 2024 Current targets Comments • Modelling our Insurance Associated Emissions • Exclusion of thermal coal (full phase out 2030 to understand the trajectory of emissions in our Reduction of insurance E
Slide 39: We understand and mitigate risks associated with ESG
Sustainable insurance We understand and mitigate risks associated with ESG to protect Zurich and to support our customers Risk area Example of action taken Physical Nat Cat Optimize exposure across key peril regions Transition risk assessment focused on Transition Speed to adapt carbon intense indus
Slide 40: Engagement and risk insight are our biggest levers to support emission reductions
Sustainable insurance Engagement and risk insight are our biggest levers to support real world emission reductions ACDC transition assessment framework Managing underwriting challenges within transitionary technology Offshore oil becomes offshore wind Alignment Commitment with Paris agreement and ne
Slide 41: In P&C, we develop risk prevention solutions through Zurich Resilience Solutions
Sustainable insurance In P&C, we develop risk prevention and mitigation solutions through Zurich Resilience Solutions Rapidly growing ESG services market is an opportunity to build stronger relationships Customers demand risk A.P. Moller-Maersk (‘Maersk’) – with more than 67 Zurich Resilience Soluti
Slide 42: Broader challenges we need to manage on our net-zero journey
Sustainable insurance There are broader challenges that we need to manage on our net-zero journey Externalities Measurement Portfolio construction Risks • Reliance on transition in real • Corporate emissions • Understanding customer • Transition technology economy targets • Data availability • Trade
Slide 43: Disclaimer and cautionary statement
Disclaimer and cautionary statement Certain statements in this document are forward-looking statements, including, but not limited to, statements that are predictions of or indicate future events, trends, plans or objectives of Zurich Insurance Group Ltd or the Zurich Insurance Group (the Group). Fo
Slide 44: For further information
For further information Call us Visit or follow us Investor Relations and Rating Agency Management • Jon Hocking +41 44 628 18 34 • Johannes Herhold +41 44 625 25 53 • Francesco Bonsante +41 44 628 00 68 • Samuel Han +41 44 625 32 57 • Michèle Matlock +41 44 625 28 50 Investor Relations website Even
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