Dialogue: Fulfilling the SOMPO’s Purpose Through SDG-Based Management

Hidemitsu Sasaya
Hidemitsu Sasaya graduated from the University of Tokyo Faculty of Law in 1976. He joined the Ministry of Agriculture and Forestry in 1977, serving as Deputy Director-General of the Minister’s Secretariat of the Ministry of the Environment, then as Deputy Director-General of the Minister’s Secretariat of the Ministry of Agriculture, Forestry and Fisheries, and finally as Director-General of the Kanto Regional Forest Office. In 2008, he joined ITO EN, LTD. and retired after serving as Director and Managing Executive Officer. He holds a PhD in Policy Studies and has been a professor of Chiba University of Commerce’s Platform for Arts and Science since April 2020.

Mr. Hamada　Here at the Sompo Group, we have always been committed to going beyond insurance and helping solve social challenges under the Sompo Group’s vision of becoming “A Theme Park for Security, Health & Wellbeing.”
When we started preparing our Mid-Term Management Plan about a year and a half ago, we first envisioned the changes in the environment 10 years ahead and started “backcasting” from there. When we think about the megatrends of the next 10 years, they overlap with the SDGs, which are set to target the year 2030. When we combined this with business trends such as stakeholder capitalism and DX (Digital Transformation), we were once again convinced that becoming “A Theme Park for Security, Health & Wellbeing” was the right direction to move in.

In addition, the impact of the COVID-19 pandemic is bringing about a massive change in social values. When we took into consideration life during the COVID-19 pandemic and post-COVID-19 environment, all of us in the management team realized that the Theme Park concept is not a vision of the distant future, but that the timeline for realizing it has moved considerably closer. That’s when we took another look at the Sompo’s reason for existence (Purpose), which underlies the Theme Park concept, and asked ourselves what it means to be the Sompo Group, and how the Sompo Group can contribute to society.
With regard to the SOMPO’s Purpose, we deliberated on our social value creation story from the early stages of preparing our Mid-Term Management Plan, clearly defining what kind of society we aim to create and what kind of value we will provide through the Theme Park concept. We had thorough discussions not only at Sompo Holdings but also at other Sompo Group companies with real businesses and customers.
The important thing is to demonstrate the value we deliver to society, and in doing so, enhance economic value and contribute to boosting corporate value. Initially, we were thinking along the lines of how to balance social value and economic value, but through repeated discussions, we came to the conclusion that the two are not in conflict, and the only difference is in the time frame for achieving profit.

And of course, the scale of this social value story is not something that can be achieved in a three-year Mid-Term Management Plan, but it has been sublimated as part of the SOMPO’s Purpose for us.
What we focused on most when formulating the Purpose was to make it something that each and every employee at each of the operating companies would feel proud and take ownership of.
SDGs in Business Management is a framework to promote initiatives to fulfill the Purpose. It is a management approach specifically designed to materialize the Theme Park concept, and we have positioned it as a business foundation in the new Mid-Term Management Plan. Going forward, we will create a framework that uses SDGs in Business Management to clarify the social challenges that the Sompo Group faces, develop them into earning power over the medium to long term, and communicate and promote them outside the company to fulfill the SOMPO’s Purpose.

Ms. Sakai　Mr. Hamada talked about the Sompo Group as a whole, including its Purpose and the new Mid-Term Management Plan, but Sompo Japan Insurance Inc., which is the core company of the Sompo Group, was founded in the early years of the Meiji Era in 1888, rooted in local fire brigade in Edo. We have carried on our mindset of protecting our customers and contributing to society for 130 years.
The President of Sompo Japan attended the Rio Earth Summit in 1992 and established the Department of Global Environment in the same year. I was also assigned to this Office in 1996. I remember many people asking at that time "why a P&C insurance company addresses environmental issues.” However, since expectations for companies have evolved from Corporate Social Responsibility (CSR) to Creating Shared Value (CSV), and then contribution to SDGs, I feel that Sompo Japan was one of the companies that realized its value quite early.
In fact, about 85% of Sompo Japan Insurance Inc’s employees think that their work is related to sustainability. The challenge is how to evolve this idea while tying it into business. I believe that if we can create a virtuous cycle of solving social challenges and creating social value through our core business, we will grow into an even better company.
We have clearly stated our focus on “SDGs in Business Management” in the new Mid-Term Management Plan, and we fully intend to establish a unique position in this field.

Mr. Sasaya　Tying SDGs to management is a great idea and is extremely important. Differences in the competency of top management and employees in terms of their understanding of sustainability become apparent through management. This has been a point of focus since the publication of the “Guidance on Social Responsibility (ISO26000:2010).” The Sompo Group already has this. Your company’s legacy, including its CSR activities, is a great strength.
The impact of the Sompo Group, with its long history of CSR, turning to SDGs in Business Management is profound. The SDGs are related to all four elements of management - people, goods and services, money, and information - and there are methods for incorporating them into management, which makes them an effective compass for disseminating information worldwide. I think it is remarkable that your company has adopted this as the basis for management.

Ms. Sakai　I believe that Goal 17 of the SDGs (partnership) is special, and particularly important. Today’s social issues are complex and difficult for individual companies to solve on their own. Since the early 1990s, SOMPO has been actively working to address environmental challenges, and we have insisted on partnering with stakeholders from the outset. To date, we have partnered with over 300 NPOs and have concluded cooperation agreements with more than 200 local governments. For example, our “Open Lectures on the Environment,” held in collaboration with environmental NPOs, has attracted about 30,000 participants over the past 30 years. We are confident that our partnership initiatives will never be considered “SDGs wash.”
Furthermore, in recent years, the presence of social entrepreneurs has been growing and the mindset of the younger generation has been changing drastically, so we are envisioning a new platform to connect these people with local companies and local governments. In addition, Institute for Advanced Biosciences, Keio University (Tsuruoka City, Yamagata Prefecture), where employees of Sompo Japan Insurance Inc. are assigned, is taking on the challenge of new co-creation involving venture companies and NPOs. We would like to further evolve our partnership model, taking into account talent development and recurrent education for senior personnel.

Mr. Sasaya　The more I hear about it, the more profound it gets. Insurance can be a hub for solving social challenges because it can close in on a wide range of social challenges. I think Sompo Holdings has the potential to become a platform for partnerships, including for the newly acquired RDP. The SDGs are like magnetic fields that strengthen partnerships and attract innovation. Cooperation based on SDGs is quicker because of the common language the SDGs provide. To visualize the impact of the SDGs on the RDP going forward, place SDG 17 (partnership) in the middle and draw the other SDGs around it. The RDP will tie into a variety of solutions that leverage the data as an outlet through B2B2C, and as a result, contribute to the many targets of the SDGs that sur-round it. For example, nursing care is Goal 3 (Good health and Well-being), resiliency is Goal 11 (Sustainable cities and communities), and so on. Seen this way, the RDP is like an all-encompassing framework governed by the SDGs.
The SDGs consist of “compulsory performances” that all companies must do and company-specific “showcase performances.” The matrix organization, which is compulsory, applies to many issues, but since Sompo Holdings has a sophisticated business model, the 17 goals alone are not enough to describe it. In particular, I don’t think it is possible to fully express the “assurance of physical, mental, and social well-being” which is clearly stated in the UN document “Transforming Our World: The 2030 Agenda for Sustainable Development” that contains the SDGs. That portion will be a showcase. I refer to this as the 18th goal of the SDGs. What your company communicates will generate reactions world-wide and invigorate the entire Sompo Group, accelerating the movement globally. I think it evokes the “moonshot” or “level of ambition” that the SDGs emphasize as part of solving difficult social challenges.
In addition, as the massive network of Sompo Japan Insurance Inc. incorporates SDGs, it will become a model within the Sompo Group and take on the role of rolling the SDGs out across the Group. Then, carrying out SDGs in Business Management by making full use of intangible assets such as history and tradition, corporate culture, network, brand credibility, group strength, and risk management know-how will lead to the redesign of the corporate brand.
The biggest thing that came about with COVID-19 was the separation of people. Our conventional values were invalidated, which led to a paradigm shift as more and more people began to reflect. In addition to carbon neutrality, which is included in the “E” portion of ESG, the Sompo Group’s SDGs in Business Management also focuses on people, which is important in the “S” portion of ESG. I believe that the world will look to the Sompo Group as a solution provider that con-tributes to “Build Back Better” in the post-COVID-19 days.