Group and sustainability strategy

Our Group strategy encompasses ten strategic principles that apply to all business units and help to ensure realisation of our vision for the strategy cycle 2018 to 2020 “Creating value through reinsurance”. The objectives of our Group strategy are pursued in accordance with our holistic management system Performance Excellence 2.0. Based on the Excellence Model of the European Foundation for Quality Management (EFQM), this requires each organisational unit of our Group to explore and define its contribution to the Group strategy. In this way, we ensure that all initiatives and measures within our Group are rigorously linked to the Group strategy. Indicators for the status of target attainment are mapped centrally in our Target Matrix. For further details please see the section “Value-based management” in the combined management report.

Group Strategy 2018-2020

1. We have ambitious profit and growth targets
   • Generate a profit in excess of the cost of capital
   • Grow the premium volume (by more than the market average)
   • Generate an IFRS return on equity of at least 900 basis points above the risk-free interest rate
   • Outperform the Global Reinsurance Index (GloRe) over a three-year period
   • Consistently pay an attractive dividend

    

2. We are a preferred business partner
   • Enhance the commercial success of our clients through our risk solutions and services (attractive value proposition)
   • Maintain excellent ratings from the rating agencies most relevant to our industry

 

3. We aim for successful employees
   • Harmonise the size and skills of our workforce with the current and future requirements of our global market presence as well as with the requirements of increasing digitalisation
   • Foster motivation, dedication and teamwork through excellent leadership practices
   • Facilitate the greatest possible delegation of tasks, responsibilities and authority
   • Increase the proportion of women on all levels of management

 

4. We strive for an optimal balance between stability and yield of our investments
   • Achieve the target return – risk-free interest rate plus cost of capital

 

5. We manage risks actively
   • Ensure protection of capital through quantitative risk management

 

6. We maintain an adequate level of capitalisation
   • Ensure that requirements for equity resources (economic capital model, solvency regulations etc.) are met
   • Optimise the overall cost of capital
   • Use special dividends to balance equity growth with profit growth

 

7. We conduct our business with lower costs than our competitors due to our high efficiency
   • Ensure a lower expense ratio than our competitors through an effective and efficient organisation

 

8. We support our business through efficient information technology and take advantage of digitalisation and automation
   • Develop new business opportunities on the basis of digitalisation and automation
   • Optimise internal processes and shape the interaction with our clients as efficiently as possible

 

9. We are committed to sustainability, integrity and compliance
   • Ensure conformity with all legal requirements, our own corporate policies and high ethical standards
   • Support social objectives particularly in the area of qualified training, not only within but also outside the company
   • Encourage sustainability in the transaction of our business, with a special focus on the avoidance of adverse impacts on the environment

 

10. We strive for Performance Excellence and continuous improvement
    • Ensure the rigorous derivation of strategic objectives across all areas of the company

In response to the progressive digital transformation in the world of business over the coming years, we have developed an additional digitalisation strategy for the strategy cycle 2018-2020. This considers in detail the opportunities and risks associated with digitalisation – with an eye to both our business processes and our work as a reinsurer.

Sustainability also forms an integral part of our actions. Our goal is to harmonise our business operations with environmental and social requirements. To do this, we have refined a sustainability strategy that complements the guiding model of our Group strategy. This defines four action fields (Governance and Dialogue, Product Responsibility, Employees, Environment and Society) as well as concrete goals and measures, while also taking into account the major requirements and interests of our stakeholders. Of particular relevance here are our customers, our investors and our employees.

The sustainability strategy, goals and measures are reviewed and approved by the Executive Board. Sustainability measures are implemented on a decentralised basis in the various market and service departments. The coordination of strategic goals and measures as well as the collection of data for reporting purposes are handled by an interdisciplinary team composed of representatives of all relevant business units.

Materiality analysis

With a view to identifying material non-financial topics, we conducted another stakeholder survey with an external partner in 2018. Representatives of the stakeholder groups comprised of customers, brokers, the capital market, employees, non-governmental organisations (NGOs) and the public sector were surveyed by means of an online questionnaire and telephone interviews. On this basis, our already existing materiality analysis was reviewed and adjusted. In this context, we took into account the various materiality approaches of the GRI, which constitutes the basis for our extensive annual sustainability report, and the German Commercial Code (HGB), on which this combined non-financial information statement is based. As a first step, potential issues were identified using internal sources and already received stakeholder feedback as well as information obtained from media analysis, a peer comparison and global standards. The issues were then categorised according to our four action fields in the context of the sustainability strategy. While the external survey developed on this basis focused on the relevance of these issues, the internal survey carried out among our employees included additional dimensions, namely “business relevance” and “impacts on business operations”. All three dimensions were rated on a scale of 1 to 7, with the lowest figure indicating very low relevance and the highest reflecting a very high degree of relevance. We considered issues rated 5.0 and higher to be material for our company within the meaning of this legislation. The survey findings were discussed and approved at an internal workshop attended by representatives of various specialist units and management.

In total, we identified 13 material sustainability issues in accordance with the German Commercial Code (HGB) and the GRI, which we discuss below in our non-financial information statement and will report on going forward on a voluntary basis in our annual sustainability report compiled in accordance with GRI standards.

The following table compares the reportable aspects as defined by the German Commercial Code (HGB) with the material issues identified by our company and pinpoints thematic overlaps with the aspects. The individual material issues are then discussed.