Biodiversity
Sampo Group works to raise awareness on biodiversity and investigate how to take biodiversity into account in its insurance and investment activities.
Sampo Group’s guiding principles on climate, biodiversity, and the environment are defined in the Sampo Group Code of Conduct. The Code of Conduct is reviewed annually and approved by Sampo’s Board of Directors. In addition, each Group company has adopted supplementary policies and guidelines for their own purposes.
Sampo Group follows the development of regulation (e.g. Corporate Sustainability Reporting Directive, CSRD), metrics, and tools, and strives to develop its own investment analysis and insurance operations in relation to biodiversity. The Group also monitors the progress of the Taskforce on Nature-related Financial Disclosures (TNFD) framework and the company’s abilities to report according to it.
Sampo Group has screened its investment and insurance portfolios to identify sectors and exposures most relevant in terms of biodiversity-related impacts and dependencies. The methodology, scope and limitations, and results of the assessments, as well as planned future actions are described below.
Investment operations
Sampo Group has conducted a high-level biodiversity assessment using ENCORE* to evaluate its sector-level exposure to nature-related impacts and dependencies in its investment portfolio. This assessment is necessary for the further evaluation of investee companies’ exposure to nature-related impacts and dependencies, as well as for the future development of the Group’s biodiversity investment framework, including engagement activities with investees. Sampo Group assesses the biodiversity impacts and dependencies of its investment portfolio on a regular basis.
* The ENCORE tool was developed by the ENCORE Partners (Global Canopy, UNEP FI and UNEP-WCMC) and first launched in 2018. Sampo Group used the October 2024 version of ENCORE in the assessment.
Scope and limitations
The assessment includes Sampo Group’s investments, for which a sector code (ISIC) was available. The coverage is approximately 76.7 per cent of the Group’s total investment portfolio. ENCORE considers the impacts and dependencies on a sector level, which means that specific information related to the investee companies’ operations, geographical locations, and mitigation actions is not reflected in the assessment. Additionally, ENCORE currently only covers direct potential impacts and dependencies, meaning that the potential indirect impacts and dependencies related to the sectors’ upstream and downstream value chain are not considered in the assessment.
Results
According to the assessment, approximately 12.2 per cent of Sampo Group’s investments are in sectors that have potentially high or very high impact on at least one pressure point of biodiversity loss. The sectors in Sampo Group’s investment portfolio with potential high or very high impacts are manufacturing, energy production and supply, construction, transportation and storage, mining and quarrying, agriculture, forestry and fishing, and water supply. The most material pressure points for these sectors are emissions of toxic soil and water pollutants, emissions of greenhouse gas (GHG) and non-GHG air pollutants, disturbances (e.g. noise, light), and generation and release of solid waste.
According to the assessment, approximately 12.7 per cent of Sampo Group’s investments are in sectors that are potentially highly or very highly dependent on at least one ecosystem service. The sectors in Sampo Group’s investment portfolio with potential high or very high impacts on biodiversity loss are also potentially highly or very highly dependent on at least one ecosystem service. Additional sectors in Sampo Group’s portfolio, which are potentially highly or very highly dependent on at least one ecosystem service, include real estate activities, accommodation and food service activities, and administrative and support service activities (rental and leasing activities). The most material ecosystem services for these sectors include water supply, water flow regulation, soil and sediment retention, flood control and visual amenity services.
The graph illustrates the distribution of Sampo Group’s investments by the sectors’ potential impacts and dependencies on nature, based on the ENCORE methodology. The ratings are based on the sectors’ highest potential impact and dependency, i.e. if a specific sector has, for example, very high impact on at least one pressure point or very high dependency on at least one ecosystem service, the whole sector gets a rating of very high.
Based on the high-level assessment, Sampo Group has identified the largest exposures in its investment portfolio that operate in sectors with potentially high or very high impacts and/or dependencies. The assessment has been further deepened by considering the geographic locations of the investee companies in relation to nature sensitive areas, as well as the mitigation actions taken by the investee companies, such as biodiversity policies and alignment with the TNFD’s recommendations. The results are used within Sampo Group to plan and implement engagement actions with investee companies, for instance.
Insurance operations
Sampo Group has performed a high-level biodiversity assessment of its insurance portfolio. The purpose of the assessment was to identify portfolio sectors that are materially exposed to natural capital from an impact, dependency, and/or financial perspective. ENCORE’s sector ratings were utilised as a key input, and the assessment was further enriched by considering country-specific risk indicators for the countries in which the insured companies or assets are located.
Scope and limitations
The assessment includes Sampo Group’s Commercial and Industrial insurance portfolios. The scope is limited to non-private portfolios, where nature-related dependencies and impacts are expected to be most significant. As the assessment utilises the ENCORE methodology, it is subject to the same limitations presented above under the section Investment operations. Additionally, the data related to country-specific risks, for instance, is still limited and developing.
Results
The assessment indicates that overall, biodiversity exposure is concentrated rather than systemic across Sampo Group’s Commercial and Industrial portfolios. They key sectors identified include manufacturing, energy production and supply, construction, transportation and storage, mining and quarrying, and agriculture, forestry and fishing in the Nordics, where Sampo Group’s corporate customers mainly operate. The high-level assessment provides a foundation for deepening the analysis, translating identified impacts and dependencies into financial risks, and enabling targeted follow-up within a defined set of sectors.
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