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2-12
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IIRC
The insurance and financial business of the PZU Group are the foundation of Poland’s social and economic security. The business activities undertaken affect the surroundings, the environment and the quality of life. That is why the PZU Group pays very close attention to developing in a sustainable manner, taking into account the current needs of stakeholders and caring for the future of the next generations.
The PZU Group is gradually introducing the concept of sustainable development into more areas of its business.
In the short to medium term, this allows them to gradually improve their business efficiency, the quality of the relationships they build, or better match the needs of their stakeholders. In the long term, this translates into an increase in the potential to build value and greater resilience of the entire organization to the impact of negative external factors.
From a reporting perspective, the management aspects are described based on the International Integrated Reporting Council’s “IIRC” guidelines. The report presented included key issues related to value creation over time using available equity, i.e., resources that the organization has access to and can use to create value, as well as other key issues identified by stakeholders
Business and equity
Business activity, with insurance as the key element, is at the core of the PZU Group’s value creation model. The offering is supplemented by health, banking, investment and pension products. Detailed information on the activities of the PZU Group is presented in the Management Board Activity Report.
Equity management in the PZU Group is implemented in accordance with the PZU Group’s strategy. This is why aspects related to the core business of the PZU Group – insurance offered by PZU and PZU Life – are of greatest importance.
This category includes financial resources held by the PZU Group, obtained from external sources (clients, shareholders, bondholders) and internal sources (profits generated on the Group’s business operations).
| Financial capital | 2021 | 2022 |
|---|---|---|
| Assets | PLN 402.1 billion | PLN 436.1 billion |
| Equity | PLN 40.0 billion | PLN 39.8 billion |
| Subordinated bonds | PLN 6.3 billion | PLN 6.28 billion |
| External customer assets under management (KPI – strategy) | PLN 35.3 billion | PLN 39.2 billion |
Performance management pertaining to this type of capital includes in particular activities related to:
- maintaining financial security and stability;
- ensuring funds for the development and pursuit of the strategy;
- operational and cost effectiveness
| Financial capital – results | 2021 | 2022 |
|---|---|---|
| Gross insurance premiums written (KPI – strategy) | PLN 25.1 billion | PLN 26.7 billion |
| Investment income | PLN 10.2 billion | PLN 18.2 billion |
| Operating profit | PLN 7.5 billion | PLN 7.6 billion |
| Net profit for shareholders of PZU parent company (KPI – strategy) | PLN 3.34 billion | PLN 3.37 billion |
Example of impact on other capitals:
- intellectual (innovation dynamics);
- human (salaries-costs);
- social and relationship (the scale of support for local projects);
- infrastructural (number of branches);
- natural (green investments, taxonomy, emissions offsets).
As regards intellectual capital, of key significance to the PZU Group are the intangible resources of the whole organization and distinct employees in the form of knowledge, experience, research, development and pursuit of a culture of innovation.
| Intellectual capital | 2021 | 2022 |
|---|---|---|
| Expenditures on project activities in the Group | PLN 137 million | PLN 154 million |
| Number of innovation centers in the Group | 6 | 6 |
| Number of people involved in innovative projects (PZU LAB) | >150 | >150 |
| Acceleration and mentoring programs | 2 | 2 |
Performance management pertaining to this type of capital includes in particular activities related to:
- developing CRM systems, tools for remote sales and contacts with clients;
- personalizing the product offering;
- building product ecosystems;
- integrated approach to distribution channels (omnichannel approach);
- implementation of Group standards and regulations;
- building an environment favorable to innovation.
Example of impact on other capitals:
- financial (operating expenses);
- human (competence; well-being);
- social and relationship (customer satisfaction, location);
- infrastructural (availability of offerings);
- natural (product innovation).
| Intellectual capital – results | 2021 | 2022 |
|---|---|---|
| NPS recommendation index – after insurance purchase | 31 | 44 |
| NPS recommendation index – after using | 25 | 25 |
| Number of innovative pilot programs | 12 | 14 |
| Number of innovative projects submitted for implementation | 7 | 8 |
This type of capital is made up of employees, agents and business partners of the PZU Group. It involves matters related to creating a friendly workplace, caring for safety, building relationships based on honesty, respect and dialogue, supporting diversity, managing talents and retaining key employees.
| Human capital | 2021 | 2022 |
|---|---|---|
| Number of employees per FTE (PZU and PZU Życie) | 10.0 thousand | 9.8 thousand |
| Average number of training hours per employee (PZU and PZU Życie) | 27.9 | 29.6 |
| Percentage of people working remotely (PZU and PZU Życie) | 57.0% | 28.5% |
| Number of employees covered by training (PZU and PZU Życie) | 1 thousand | 1.1 thousand |
Performance management pertaining to this type of capital includes in particular activities related to:
- diversity and respect for human rights;
- ensuring safe working conditions;
- development and training;
- hiring and retaining key employees;
- ensuring a healthy work-life balance for staff;
- ensuring conditions for an honest dialog with trade unions;
- shaping ethical attitudes.
| Human capital – results | 2021 | 2022 |
|---|---|---|
| Employee involvement index | 48% | 46% |
| Ratio of new employees (in FTEs for PZU and PZU Życie) | 6.8% | 8.0% |
| Employee resignation index (PZU and PZU Życie) | 10.2% | 10.4% |
| Ratio of average basic salary of women to men (PZU and PZU Życie) | 96% | 96% |
Example of impact on other capitals:
- financial (operating expenses);
- intellectual (culture of innovation);
- social and relationship (brand recognition);
- infrastructure (availability of offerings);
- natural (awareness of the impact on the environment).
This type of capital is made up of shared norms, values and behaviors that build long-term and lasting relationships with stakeholders. These are aspects related to client loyalty, brand perception and preventive, sponsoring and social activities.
| Social and relational capital | 2021 | 2022 |
|---|---|---|
| Number of volunteers (PZU and PZU Życie) | 900 | 2 490 |
| Funds transferred for prevention activities (PZU and PZU Życie) | PLN 50.3 million | PLN 54.2 million |
| Funds donated for sponsorship activities (PZU and PZU Życie) | PLN 24.6 million | PLN 35.5 million |
| Funds donated to the PZU Foundation | PLN 20.7 million | PLN 28.0 million |
Performance management pertaining to this type of capital includes in particular activities related to:
- setting standards for cooperation with suppliers and business partners;
- deploying systems to improve customer service;
- approach to recruiting and supporting agents;
- promoting a healthy lifestyle;
- disease prevention;
- accident prevention;
- providing support to local communities;
- supporting activities aimed at promoting sports, culture and art.
Measurement of the effectiveness of this type of capital is largely based on analyzing the outcomes of preventive and sponsoring campaigns, social campaigns and socially beneficial projects, and the use of funds allocated to activities pursued by foundations.
Example of impact on other capitals:
- financial (price elasticity);
- intellectual (brand recognition);
- human (engagement);
- natural (environmental awareness in the supply chain).
| Social and relationship capital – results | 2021 | 2022 |
|---|---|---|
| Number of volunteerism projects authored by PZU employees | 97 | 78 |
| Number of PZU Foundation beneficiaries | 39,423 | 457,500 |
| Number of volunteerism actions organized by the PZU Foundation | 6 | 9 |
| Number of recipients of community activities on safety and sustainable lifestyles | 10.0 million | 12.2 million |
This type of capital is made up of the largest distribution and service network in Poland, in particular: branches, outlets, agents and business partners, the claims handling network, and electronic distribution channels. It also includes one of the largest corporate PZU Data Warehouses in Central and Eastern Europe as well as IT tools and systems that enable information flow both within and without the PZU Group. As a result, PZU Group clients enjoy easy and convenient access to financial products and services.
| Infrastructural capital | 2021 | 2022 |
|---|---|---|
| Number of tables / data in the data warehouse | ~ 200 thousand / 400TB |
~ 200 thousand / 400TB |
| Number of PZU, Pekao and Alior Bank branches | 1,659 | 1,540 |
| Number of tied agents and agencies (PZU and PZU Życie) | 9.7 thousand | 9.5 thousand |
| Number of PZU Zdrowie’s own branches | 130 | ~130 |
Performance management pertaining to this type of capital includes in particular activities related to:
- growth of agency structures;
- organization of work in branches;
- growth and transformation of facilities in the health area;
- standardization of structures and positions;
- development of electronic distribution channels for financial products and services;
- digitization of processes within the PZU Group.
| Infrastructural capital – results | 2021 | 2022 |
|---|---|---|
| Number of active users of data warehouses / Business Intelligence average monthly | ~ 3.0 thousand | ~ 3.5 thousand |
| Number of users of the sales and service platform mojePZU | > PLN 2.5 million | > PLN 3.3 million |
| Number of active inPZU users | 75 tys. | 117 tys. |
| Health services provided in own branches | 31% | 31% |
Example of impact on other capitals:
- financial (operating expenses);
- intellectual (level of innovation);
- human (quality of customer service);
- social and relationship (accessibility and countering exclusion);
- natural (emissivity).
This is primarily the PZU Group’s direct and indirect impact on the environment. It also covers renewable and non-renewable natural resources that the PZU Group uses in its operations.
| Natural capital | 2021 | 2022 |
|---|---|---|
| Energy consumption from non-renewable fuels | 381,963 [GJ] | 396,276 [GJ] |
| Consumption of purchased energy | 918,429 [GJ] | 775,810 [GJ] |
| Energy consumption from non-renewable fuels (PZU and PZU Życie) | 116,987 [GJ] | 123,187 [GJ] |
| Consumption of purchased energy from renewable sources | 49,093 [GJ] | 49,991 [GJ] |
Performance management pertaining to this type of capital includes in particular activities related to:
- minimizing the environmental footprint, reducing own and indirect CO2 emissions;
- shaping the investment policy;
- building climate awareness among employees, clients and partners;
- involvement in the climate and energy transition;
- implementation of ESG factors into operations;
- development of products for entities supporting low-emission technologies.
| Natural capital – direct result | 2021 | 2022 |
|---|---|---|
| Reduction of eCO2 emissions in Scope I compared to the base year (2018) | 20.1% | 16.3% |
| Reduction of eCO2 emissions in Scope II (market-based) compared to the base year (2018) | 39.6% | 56.4% |
| Reduction of eCO2 emissions in Scope I and II (market-based) compared to the base year (2018) for PZU and PZU Życie | 56.9% | 57.1% |
| Compensation for eCO2 emissions (Scope I and II for PZU and PZU Życie) | 100% | 100% |
| Natural capital – indirect result | 2021 | 2022 |
|---|---|---|
| Investments in support of climate and energy transition (YTD) | PLN 450 million | PLN 717 million |
| Products supporting climate and energy transition (YTD) | 3 | 3 |
| Assessment in terms of ESG factors of the largest corporate insurance clients from sectors sensitive to ESG risks | – | 20% |
| Assessment in terms of ESG factors of investments in ESG-sensitive sectors | – | 82% |
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3-3
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2-6
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201-1
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IIRC
Business and capitals – impact on the environment
Consolidated assets of the PZU Group amount to PLN 436.1 billion. The Group enjoys the trust of 22 million clients in five countries. It offers products and services to retail clients, small and medium enterprises and big business entities. Poland is the PZU Group’s core market measured by its magnitude and client numbers. Nevertheless, the Group’s subsidiaries play an important role on the markets in Lithuania, Latvia, Estonia and Ukraine. Insurance is the core business of the PZU Group. The Group’s companies also offer investment, pension, banking and medical services products. They render assistance services to retail clients and businesses through strategic partnerships. The Group companies’ operations are founded on clients’ trust. PZU places the client in the center of attention and integrates all areas of activity around the client. This allows it to offer increasingly personalized, flexible and comprehensive products and services matching the needs of clients at every stage of their private and professional lives and at the suitable place and time.
Due to the scale and scope of its operations, the PZU Group has a significant impact on the economy, society and the environment, among other things. With several dozen thousand employees, it makes significant contributions to the state budget from the taxes it pays, invests its assets in stocks, providing the funding needed for their development, and bonds, helping finance infrastructural projects that are important for the country, improvement of education or medical care. Through its assets, the Group is a prominent player on the financial market in Poland, exerting significant influence on its status and development directions. The claims and benefits paid by the Group help businesses maintain continuity of business in unexpected situations and avoid serious financial problems arising, e.g., from downtimes.
By insuring millions of Poles, PZU has real influence on their lives.
First of all, the claims and benefits paid out help families to maintain financial stability in difficult situations, such as illness or death of a family member, loss of home due to fire, flooding, etc. This offers additional protection, which provides the sense of stability and safety. Additionally, thanks to its products and investment funds, PZU supports Poles in accumulating savings and increase their awareness in this area, thus improving the welfare of society.
For many years, safety has been the main theme of PZU’s social commitment and contribution into the growth of local communities. PZU is engaged in actions preventing accidents or mitigating their effects; it highlights proper behavior, supports preventive campaigns and rescue services. It analyzes causes of accidents and focuses on the most urgent problems, so that its preventive actions are as effective as possible. However, the changing circumstances and the COVID-19 pandemic has directed the Company’s attention to another key area of social engagement, i.e. promotion of healthy and active lifestyle. Therefore, since the pandemic, the PZU Group particularly focused not only on prevention and physical health, but also responds to the challenges of maintaining mental balance and preventing mental health problems.
Through its activities, PZU also affects the natural environment. Because of its market position, the Group is able to set new trends. For example, by selecting environmentallyfriendly investments and sustainable suppliers, educating in the area of fight with the climate change. The ESG Strategy defines the path to neutrality. By 2024 PZU will fully use green electricity and curtail other emissions and wherever that will not be plausible it will offset them. By 2030 PZU plans to reduce emissions from its own sources and those originating from the consumption of electricity and heat to an even greater degree and will launch work on reducing emissions in the value chain. This means that it will influence others who cooperate with PZU on a permanent basis to become climate neutral: this will apply to suppliers and partners by 2040 and to insurance clients and investments by 2050. In addition, the Group plans to increase its capital commitment to investments supporting the climate and energy transition, which has already reached PLN 717 million in 2022.
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201-1
Direct economic value generated and shared
| Direct economic value generated and shared (data in PLN million) | 2020 | 2021 | 2022 |
|---|---|---|---|
| Income | 37,102 | 39,127 | 46,512 |
| Operating expenses excluding payroll, tax on financial institutions and investments in the community | (26,069) | (25,166) | (31,918) |
| Total costs from salaries and benefits for employees | (5,366) | (5,642) | (6,073) |
| Income tax | (1,841) | (1,492) | (1,672) |
| Levy on financial institutions | (1,203) | (1,290) | (1,452) |
| Voluntary contribution to invest funds in the wider community | (93) | (103) | (138) |
| Dividends paid to all shareholders | – | (3,696) | (2,578) |
| Economic value retained | 2,530 | 1,738 | 2,681 |
The retained value presented herein is the amount remaining after the distribution of the generated economic value among the company’s stakeholders. This amount is not the same as the net profit disclosed in the profit and loss account, because it also takes into account the dividends (as distributed economic value).
