AIG’s company-wide ERM function integrates each business unit’s risk management function so that senior management has a consolidated view of AIG’s key risks. This approach helps AIG embed risk management in our business processes and allows us to appropriately identify, assess, quantify, manage, monitor, report and mitigate AIG’s risk exposures. This includes risks related to changing climate conditions and societal changes that could impact operations and elevate reputational risks.
AIG has an Emerging Risk Forum to monitor, assess and analyze climate-related risks and other key emerging risks facing the company. The forum includes AIG subject matter experts from across many global geographies and functions. The Emerging Risk Forum conducts horizon scanning to facilitate cross-functional dialogue, improve information flow across the company, catalyze risk management action and spark product innovation.
In 2021, AIG’s Emerging Risk Forum collectively identified risks associated with climate change as a priority, coordinating assessments of climate-related physical and transition risks. To better understand and define climate-related risks and opportunities, and more effectively direct expert insights and opinions to lines of business that could be possibly impacted, the Emerging Risk Forum established dedicated CoPs focused on Energy Transition Risk and Physical Climate Risk. The CoPs consist of subject-matter experts from across different businesses and functional support areas. This approach complements AIG’s existing management of climate-related risks through natural catastrophe modeling, our reinsurance strategy, business continuity planning and regularly revisiting the organizational appetite for such risks.