Sustainability in Business
Swiss Life maintains high standards for its consulting, service and product range. Diligence and responsible action form the basis for successful business operations as well as for long-term, sustainable customer and business relationships.
Profitability and growth
The economic performance and sustainable profitability of Swiss Life are fundamental to the long-term success of its corporate management. Thanks to consistent implementation of its plans, since 2009 Swiss Life has successfully achieved the targets of its last three corporate programmes.
Swiss Life’s business model is aligned to the long term. We must be able to keep the promises made to our customers for decades. That is why long-term investing plays a central role in the life insurance business. Swiss Life has crafted its investment strategy to ensure that the interest margin remains positive even when interest rates stay low for more than three decades. In addition, Swiss Life has continuously developed its business in recent years. With its successful enhancement of asset management for third parties, owned IFA channels, modern products and acquisitions, Swiss Life has over the past years significantly increased the contribution made to its result by so-called fee business, and thus reduced its dependency on investment results. In addition to the focus on profitability, capital efficiency remains a relevant control parameter in new insurance business.
At its Investor Day in November 2018, Swiss Life presented its corporate programme and financial targets for the period to 2021. With “Swiss Life 2021” the company is aiming at a continuous and yet ambitious further development of its profit sources, efficiency and distribution to shareholders.
Further information on the Group-wide programme and the Swiss Life Group strategy may be found in the section Strategy & Brand.
Swiss Life places people at the centre of its activities and engages with them on an equal footing – whether in customer advising, processes, products and services, dealing with employees, using technology or in our role in society as a whole.
Since 2014, Swiss Life has been continuously assessing customer satisfaction at the key contact points. Customers are asked about their experience, satisfaction and willingness to recommend Swiss Life at selected contact points. Anyone who gives a negative response is contacted within 48 hours. This allows Swiss Life to ensure it has understood the reasons for a negative review and to offer the customer a solution. Customer satisfaction is surveyed in close collaboration with an independent market research institute.
Swiss Life aims to use customer feedback to detect systemic problems, drive appropriate process optimisation measures and enable customers to express appreciation. The findings and lessons learned are used for ongoing employee training and coaching and are shared at Group level.
Swiss Life has continuously expanded its Direct Customer Feedback programme in recent years. Since launching it in 2014, Swiss Life has received and analysed around 226 000 customer communications, including more than 66 000 in 2019.
Swiss Life depends on the Net Promoter Score (NPS) for its quantitative measurement of customer satisfaction, which indicates a customer’s willingness to recommend a provider to family and friends. The NPS is surveyed continuously and reported internally on a quarterly basis. What is more, the NPS is a component of the objectives-setting and performance review of employees with customer contact.
The Swiss Life NPS has improved by and large at the key contact points, Consulting and Service Center, over the past four years, thanks to regular customer feedback analysis and the improvements derived from it.
The development of the NPS at consulting contact points
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|Switzerland Swiss Life Select||+48||+41||+39||+29|
|Germany Swiss Life Select||+64||+62||+53||+45|
|Austria Swiss Life Select||+58||+49||+44||+34|
|UK Chase de Vere||+56||+52||+56||+52|
The NPS at the Service Center contact point has also either developed positively or remained stable. In 2020, Swiss Life wants to make further improvements with the aid of digital tools.
The development of the NPS at the Service Center contact point
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Promoting and consolidating a customer-oriented work culture
In addition, Swiss Life surveys the internal perception of customer orientation. Until 2019, the Employees’ Customer Centricity Index (ECCI) was applied in-house and summarised the results. The Index rose in the last assessment, in 2017, by three index points over the previous year, to 81. The internal perception of customer centricity improved in 2017 in relation to all areas surveyed.
In 2019, the internal perception of customer centricity was measured as part of a Group-wide survey on employee engagement. The survey is held biannually and conducted in cooperation with an independent consulting agency.
Above-average customer orientation at Swiss Life
|Swiss Life Group||86%|
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|Relative to the global average of companies in the financial sector||+10 ppt|
The 2019 survey showed that 86% of all employees see Swiss Life as a customer-oriented company. The results were 4 percentage points above the results for the most successful companies worldwide and 10 percentage points above the global average for companies in the financial sector.
Products, services and advice
A customer relationship at Swiss Life often spans several decades. Thanks to its individual pension and financial advice for private and corporate customers and proven investment expertise for institutional investors, Swiss Life enables people to lead a selfdetermined life.
Swiss Life’s consulting and product strategy combines optimal customer value with profitability for the company. The company offers private and corporate clients comprehensive and individual advice plus a broad range of proprietary and partner products through its financial advisors, agents and distribution partners. Swiss Life Select, the subsidiary specialising in financial planning for private households and brokering financial products, as well as the advisors at Tecis, Horbach, Proventus, Chase de Vere and Fincentrum, use the Best Select approach to let their customers choose the product from the market that suits them best. In this way, customers are given access to an extensive range of products from many suppliers.
In France, Swiss Life developed a sustainable investment solution in 2019. “Swiss Life Choix Responsable” offers a new option of investing in a product that focuses on responsible management and environmental, social and governance (ESG) criteria. Moreover, in the reporting period Swiss Life started work on a Group-wide ESG approach in the area of insurance as part of its new sustainability organisation.
Transparent product information and promotion of financial literacy
In addition to its customer-focused consulting approach, Swiss Life pays great attention to extensive and understandable documentation. In addition to product documents on various insurance and provisions topics on the local websites or customer portals, supporting video sequences are available along with publications for download.
Swiss Life would like to help people acquire financial knowledge so they can make better decisions. That is why Swiss Life has supported the Swiss financial literacy platform fintool.ch for years now. In Germany, by way of the Swiss Life Stiftung für Chancenreichtum und Zukunft (Foundation for opportunities and the future), Swiss Life also advocates projects that promote the growth of financial literacy.
Customer centricity and Group-wide value proposition standards
Long-term benefit commitments and obligations arising from pension and financial products demand a precise analysis of the legal and regulatory environment, and the associated risk. This also provides the basis for customer-oriented consulting and is a major factor in the avoidance of mistakes or violations in advising, and their possible consequences.
Swiss Life makes sure that it can deliver its value proposition: through mandatory Group-wide regulations that are implemented through corresponding local directives:
- The specific structure of products and services is based on Group-wide standards and stringent compliance with local regulatory requirements and local laws. The ability of the local Compliance teams to make adjustments, even to existing products and services, is guaranteed. Group-wide standards for the development of products and services are also adapted to framework conditions as required.
- Product management is regulated through a number of directives at Group level. Swiss Life has established a uniform, auditable product development process to that end. This process defines the minimum requirements for local product development as well as the approval and escalation process for initiatives at Group level. The observance of laws and provisions, practical customer value and the quality of customer documentation are naturally essential criteria in the assessment process.
Swiss Life is pursuing digitalisation along the entire value chain. The focus is on initiatives that create sustainable added value for customers and employees.
As a pensions and financial services company, Swiss Life puts people at the centre of its business. This includes digitalisation. The roughly 14 000 advisors that conduct Swiss Life’s dialogue with customers have access at all times to digital solutions that support them in the advisory process. Personal contact, however, remains a key factor. Digital aids give advisors more time for personal contact and to clarify the needs of their customers. This purposeful combination of personal advice and digital support is the root of Swiss Life’s “phygital approach”.
In this way, Swiss Life meets the needs of its customers, a fact clearly highlighted by a representative survey conducted by the company in 2019 in Switzerland, France and Germany. In this survey, around 80% of respondents said that talking to an advisor is a must for them when signing a contract. People value the flexibility and independence that digital tools give them. At the same time, around 70% trust an advisor more than an algorithm. People want digital aids to help advisors identify the best solution, giving them more time for personal advice.
Digital customer portals and new forms of collaboration
Among other things, Swiss Life offers its customers online portals, where they can access their documents anytime, anywhere, make appointments, request offers and make changes quickly and unbureaucratically. Customers can use online calculators to simulate scenarios on their own. In this way, customers decide how they interact with Swiss Life and choose their mode of access themselves. Swiss Life applies industry standards and uses digital solutions to prevent discontinuity in the use of media and guarantee high quality.
Swiss Life also makes increasing use of digital platforms within the company. In 2019, Group-wide collaboration software was introduced, enabling employees to hold virtual meetings and share and work together on files.
Swiss Life systematically integrates ecological and social factors, including aspects of good corporate governance, into the investment process and risk management for all asset classes. Swiss Life is guided in this regard by the UN Principles of Responsible Investment (PRI).
At the heart of Swiss Life’s mission as an asset manager for its proprietary insurance companies and for third-party clients – such as pension funds, other insurers and private investors via collective investments – are the long-term protection of customer funds and the optimal allocation of risk capital. Invested assets must be secure, profitable and liquid in their entirety. Due to the long-term nature of its liabilities, Swiss Life invests predominantly in fixed-income securities, such as government and corporate bonds, real estate and equity and infrastructure investments. Its investment decisions have always been informed by a long-term assessment of risks and returns.
As a major investor, Swiss Life is committed to ensuring that direct investments in its portfolio are in line with its fundamental standards and values. As a signatory to the UN Global Compact, Swiss Life is committed, among other things, to the fundamental principles for respecting human rights.
Systematic integration of ESG criteria
Swiss Life systematically integrates environmental, social and governance (ESG) factors into its investment process and the risk management of all asset classes. This results in a broader information base and more balanced risk cover.
ESG factors are taken into account in nearly 90% of the total assets under management by Swiss Life. The remaining 10% are investment products such as the replication of share indices or mortgages, where this sustainability approach currently still cannot be used because of their product structure. This sustainability approach is used for third-party assets as well as for proprietary assets.
Swiss Life has set out its principles for responsible investing in its “Responsible Investment Policy”, which is available at www.swisslife-am.com/responsible-investment.
Sustainability in securities investment
In the investment process for securities – for example, shares and corporate and government bonds – Swiss Life uses, among other things, analyses by the independent international ESG research and valuation service provider MSCI ESG Research. ESG information on over 17 000 share and bond issuers worldwide helps Swiss Life identify and anticipate the risks relating to environmental and social issues and governance aspects at an early stage. This should ensure early recognition of risks arising from ESG problems such as infringements of labour law, shortcomings in corporate governance and indications of corruption or environmental risks relating to climate change.
Selective exclusions and exit from coal for power stations
For all of its assets, Swiss Life has defined specific limits for investment in the defence industry. Swiss Life recognises that sovereign states have a right to self-defence, but refrains from investing in companies with a significant involvement in the production of internationally banned controversial weapons such as land mines, cluster ammunition, and chemical, biological and nuclear weapons. For this, Swiss Life uses data from MSCI ESG Research, the exclusion lists for controversial weapons published by PAX, an international non-profit and NGO-type peace organisation, and from SVVK-ASIR, the Swiss association for responsible investments.
Climate change is one of the biggest challenges of our time. Swiss Life supports the objectives of the Paris climate agreement and has defined a strategy for exiting its assets from insurance business from the carbon-intensive coal sector. In particular, investments in coal for power stations harbour a risk of “stranded assets”, in other words assets exposed to early losses or impairment charges due to environmental or climate-related factors. Swiss Life therefore refrains from investing in bonds issued by companies which derive more than 10% of their revenue from the mining, extraction and sale of coal for power stations. With infrastructure investments, this 10% threshold is measured in terms of the carrying amount. A corresponding threshold also applies to infrastructure investments: Swiss Life does not invest in projects or companies in which more than 10% of the company or project valuation is attributable to contributions from transactions involving coal for power stations.
Swiss Life endeavours to persuade third-party customers to apply a similar exit strategy to their assets.
Exercise of voting rights
Swiss Life also represents its interests by exercising voting rights and actively fosters responsible investing through “active ownership”. In this way, it strives to increase the company’s long-term value. ESG factors are used to make a balanced assessment of the purpose of motions and the overall benefits for the shareholders of the respective company. In the past financial year, for instance, Swiss Life voted for corporate transparency in social and environmental aspects and for better governance. When exercising voting rights, Swiss Life uses analyses and services provided by the external voting rights consultant “Institutional Shareholder Services” (ISS) and other sources. In 2019, Swiss Life voted 4749 times at 361 annual general meetings. In 1% of cases it deviated from the recommendations made by ISS and in 9% of cases it voted against the Board of Directors.
Reporting und networking
Swiss Life is a signatory of, among other things, the Principles for Responsible Investment supported by the United Nations (www.unpri.org). The corresponding PRI Transparency Reports are updated annually by Swiss Life and can be viewed on PRI’s website. In the reporting period, Swiss Life became a member of Swiss Sustainable Finance (SSF). In this way, it is continuing to expand its network and is involved in an active exchange on aspects of responsible investing (see also Memberships).
Responsible real estate management
Swiss Life is one of Europe’s leading real estate investors and has the biggest private real estate portfolio in Switzerland. Preserving and increasing value in the long term and ensuring sustainable earnings are of central significance to Swiss Life. All decisions are thus oriented to a long-term property life cycle.
- To ensure that sustainability criteria can be integrated systematically into the value creation process in real estate investment, Swiss Life has developed its own Responsible Property Investment Framework. This applies for all real estate management activities and optimises the environmental and social aspects of the real estate portfolio.
- In the transaction process, a due diligence checklist is used to identify sustainability opportunities and thus highlight potential to increase value. At the same time, this checklist allows early identification of potential risks so that value can be preserved in the long term.
- Sustainability aspects play a central role in real estate development, from the feasibility study to the construction decision and are integrated into the planning process. For example, minimum energy standards are defined, ecological risk profiles are examined, the socio-economic effects of real estate development projects are analysed and decisions are taken on obtaining quality certificates such as Minergie, DGNB, SGNI, LEED, BREEAM and HQE for buildings. These sustainability certificates provide external confirmation of the sustainable quality of buildings.
- Implementing sustainability measures in property management, for example extensive renovation, specific optimisation measures, efficient in-house utilities and maintenance work helps reduce energy consumption in the portfolio. In turn, the associated increase in the energy efficiency of the properties leads to a reduction in CO2 emissions. In this way, energy-related maintenance activities (for example, replacement of heating generators or refurbishment of the building shell) can result in energy and CO2 savings of up to 50% at the properties concerned. In this way, dependence on fossil fuels can be reduced further, with a shift to renewable energy sources (for example, solar power, geothermal energy, use of river and sea water or pellets).
- Moreover, energy-saving settings on technical installations and smaller renovations with a shorter payback period (for example, lighting systems or insulation of water pipes) can bring improvements outside of major refurbishment cycles. Experience shows that such optimisation measures can generate energy and CO2 savings of around 10%.
38% of proprietary real estate investments are in Switzerland. A review of the energy consumption and CO2 emissions of the real estate portfolio in the reporting period identified properties where energy consumption is currently above average and modernisation is due in the coming years. Energy-related maintenance, for example, replacement of heating generators or refurbishment of the building shell, will be carried out at these properties in the next three to four years. Thanks to targeted optimisation of operating and maintenance activities, the energy consumption and corresponding CO2 emissions will be reduced. To sharpen tenants’ awareness of energy efficiency, the tenant survey was expanded and information leaflets on saving energy were distributed.
GRESB – Global Real Estate Sustainability Benchmark
Since 2018, six of Swiss Life’s investment vehicles (approximately 50% of total real estate assets under management) have been included in the annual Global Real Estate Sustainability Benchmark (GRESB). This sustainability benchmarking analysis enables Swiss Life to systematically measure sustainability aspects of the real estate portfolios evaluated and to integrate this into its facility management. All of the portfolios analysed qualify for the Green Star, which positions their sustainability performance versus the benchmark in the top quadrant.
Sustainability in infrastructure and clean energy investments
ESG criteria are a central element in the evaluation of alternative investments such as infrastructure projects, which may involve a combination of a substantial financial investment, a long-term horizon and potential to enhance sustainability. As at year-end 2019, Swiss Life managed assets in infrastructure investments with a value of over CHF 3.3 billion. For classical infrastructure investments, an internal ESG assessment scheme is used to ensure that these investments offer added value from an environmental and social perspective. This internal assessment scheme is based on the European Investment Bank’s ESG benchmarks.
In October 2019, Swiss Life acquired Fontavis AG, a leading investment manager for clean energy and infrastructure funds in Switzerland. Fontavis manages and advises infrastructure funds with total assets of CHF 1.25 billion. The portfolios are broadly diversified, with a special focus on heat and on hydroelectric, solar and wind power. These installations generate 2.6 billion kWh power a year from renewable energy sources. Broken down to the stakes in the respective companies, that corresponds to around 500 million kWh. In addition, the companies in the portfolios generate 200 million kWh ecological heat (68 million kWh based on the stake in each company). This ecological heat generation avoids emissions of 44 500 tonnes CO2, which would result, for example, from oil-fired heating.
Compliance at Swiss Life
Swiss Life sets great store by compliance with all applicable legal provisions and regulatory stipulations. Correct and honest behaviour by its employees is mandatory.
Code of Conduct
Swiss Life maintains high standards for the quality of its consulting and services. That includes values and conduct that form the basis for a trusting relationship with customers and partners. The Code of Conduct contains Swiss Life’s Group-wide values and principles, and rules of conduct, which are binding for all employees.
The Code of Conduct applies Group-wide. The present version was revised in 2018 and published in January 2019. When it was published, all employees in the Swiss Life Group were informed about the changes. The Code of Conduct can be viewed at www.swisslife.com/en/coc.
Swiss Life has extensive directives to make sure the Code of Conduct is put into practice in daily activities. These contain binding Group-wide minimum standards implemented in all business units and included in the regulations for the local offices. Directives are reviewed regularly to ensure they are still correct and up-to-date. They are adapted where necessary to take account of new regulatory and business-specific requirements.
Regular training ensures that the employees are kept informed about the relevant compliance themes and directives. All new employees throughout the Group receive training on the Code of Conduct and essential rules of behaviour as well as the data protection and data security requirements, within six months after joining. All new employees are likewise provided within the same period with training on the prevention of monetary laundering, combating the financing of terrorism and sanctions and embargos, to the extent relevant for their activity. All employees also undergo refresher training on these issues every two years. Participation in such training is compulsory and is checked. The goal is a 100% participation and success rate. Refresher courses are provided more often in divisions where the regulator prescribes more frequent training. In addition, in some cases external advisors and other contractors are trained in compliance issues or required to give a contractual assurance that they will comply with the Code of Conduct. Development of a uniform, Group-wide ruling is planned for 2020.
Swiss Life has established processes to ensure adequate identification, management and control of compliance and data protection risks. The roles, responsibilities and competencies of Compliance are defined and documented by Swiss Life within the governance framework.
Data protection has absolute priority at Swiss Life. All legal, regulatory and internal requirements are implemented throughout the Group. Group-wide standards for data protection have been defined. These cover all areas of business and are specified and implemented through divisional directives and data protection undertakings. These cover the processing, storage, deletion, archiving and transfer of data and documents, uniform data classification, handling of personal data and data requiring special protection and trade secrets, and the rights of data subjects, such as the right to information and erasure. When processing personal data, Swiss Life consistently complies with the applicable regulations for Switzerland and the EU, and other local laws.
Infringements of data protection must be reported immediately to Compliance and information security incidents are handled consistently throughout the Group through operational risk management. The compliance framework contains defined processes for dealing with infringements of data protection. These include, for example, informing the data subjects and supervisory authorities.
There were no significant data protection infringements within the Swiss Life Group during the reporting year.
The individual divisions have their own data protection officers and ensure that their employees are all provided with regular mandatory training in the material. The line implements these requirements and assesses their observance in collaboration with the relevant divisional Compliance teams, as well as at Group level. Compliance regularly assesses the implementation and observance of the applicable provisions. The Board of Director’s Audit Committee and the Corporate Executive Board’s Risk Committee receive continuous information on data protection issues within the framework of compliance reporting. Corporate Internal Audit regularly reviews data protection as part of its auditing activities and addresses any weak spots with the appropriate measures.
Data are secured and protected with the appropriate organisational and technical protection measures and are a part of risk management. More information on the subject of risk management can be found in the Annual Report in the section Risk Management.
Lawful business activity
Compliance monitors and assesses the legal and regulatory environment, taking account of relevant local legislation. The aim is not to infringe any legal and/or regulatory requirements, and to prevent all forms of corruption and bribery. Swiss Life also considers it very important to comply with sanctions and embargos. Regular risk assessments as well as permanent and comprehensive compliance reporting to the top echelons provide support for the implementation of all requisite measures at Group level and within the business units. The compliance framework is subject to periodic review and is reworked and adapted to new prerequisites as necessary.
Swiss Life incurred no significant monetary penalties or fines during the year under review, nor did the company make any settlements in connection with corruption charges or anti-competitive behaviour.
Swiss Life also demands compliance with high sustainability standards from its external service providers and suppliers, which extends to their responsibility towards their employees, society and the environment.
Swiss Life mainly accesses products and services from the following categories:
- Professional services (advisory services for example)
- Marketing and public relations
- Human Resources
- IT services and telecoms
- IT software and IT hardware
- Facility management services (e.g. security personnel, building maintenance, cleaning) and general services (refreshments, electricity, gas etc.)
- Travel and events
Swiss Life is one of Europe’s leading real estate investors and has the biggest private real estate portfolio in Switzerland. As part of this activity, Swiss Life mainly uses external services for architecture and expert planning services plus general construction services.
Most of the suppliers and service providers in Switzerland are domestically based. About 20% are from the EU.
Swiss Life also works mainly with national suppliers in its other core markets, France and Germany. Foreign suppliers account for under 5% in both countries.
In cooperating with major international companies in the IT area, Swiss Life works with their national subsidiaries wherever possible at all locations.
Guidelines for suppliers and service providers
All companies at all locations that wish to work with Swiss Life must ensure compliance with the standard statutory provisions. Evaluation of key suppliers and service providers is integrated in the Swiss Life Group risk management framework.
Swiss Life demands corrective action against any violations of agreed standards. The cooperation is terminated in the event of serious or repeated violations. Swiss Life contractually asserts its right to conduct audits of suppliers and service providers. That includes requesting, for example, confirmation of ISO certification, the validity of such certification and analysis of the underlying reports.
When concluding contracts with suppliers and service providers in France and Switzerland, Swiss Life stipulates that they must guarantee the following standards as a rule:
- Compliance with applicable environmental and climate protection standards
- Compliance with legal regulations on working hours and ensuring working conditions that do not endanger employee health or security.
- Fulfilment of legal regulations relating to salaries, compensating overtime and payouts.
- Ensuring that their employees can work in an environment free of discrimination on the basis of race, gender, religion, origin, disability, age, sexual orientation, handicap or other attributes.
- Respect for employees’ rights of association and collective bargaining.
- Renunciation of child and forced labour
At its Swiss location, Swiss Life also gives priority to products and services from companies that can prove they have a certified environmental management system (ISO 14001 or EMAS) and a general quality certification (e.g. ISO 9001 or ISAE 3402).
In France, Swiss Life commits to monitoring its strategic suppliers’ environmental, social and ethical risks based on the EcoVadis methodology, which is derived from a framework of 21 corporate social responsibility criteria. The methodology is based on leading and recognised standards, such as the Global Reporting Initiative (GRI), “UN Global Compact” and ISO 26000, and is supervised by an international scientific committee. When issuing tenders, Swiss Life France routinely asks for any available sustainability rating results and ISO certification and decides on a case-by-case basis whether certification is required as a basis for cooperation.
Swiss Life Germany stipulates in its contracts with partners that they must guarantee, for example, compliance with all health and safety regulations and payment of the minimum annual salary. Moreover, Swiss Life Germany checks the sustainability and recyclability of purchased products.