News Middle East20 Jul 2014

Global:B20 promotes mutuality

20 Jul 2014

Mutuals and cooperatives around the world are celebrating a major step forward in terms of global promotion for their values-based business model.

Negotiations before and during the Business 20 (B20) Summit in Sydney in Australia that took place on 16-18 July, have resulted in the inclusion of an important “mutuals” statement in the B20's Infrastructure and Investment Policy discussion document, according to a media bulletin released last Friday by the International Cooperative and Mutual Insurance Federation’s (ICMIF).

The statement (highlighted in bold) appears in the “Capital markets and financial instruments” section of the documents that read:

“Local currency capital markets are underdeveloped in many jurisdictions, and this can be a particular barrier to investment in countries where the costs of currency hedging are prohibitively high for foreign investors. The best way for governments to promote the development of local capital markets to support long-term investment vary, and individual countries should develop their own plans to do so in the most appropriate way. Options range from the removal of unnecessary restrictions on Public Pension and Sovereign Wealth Fund asset allocations, promoting the development of Local Currency Bond Markets, promoting the development of well-structured insurance and pension industries, and ensuring adequate disclosure and reporting rules, to support for more advanced financial mechanisms, such as pooling. There may also be opportunities for mutualisation of infrastructure companies and assets in some contexts.”

Dr Andrew Crane, CEO of the CBH Group and the Chairman of the Business Council of Co-operatives and Mutuals (BCCM), Australia, and his team are credited for bringing cooperative and mutual issues and solutions into the B20 Taskforce deliberations. Dr Crane is advising the Australian Government on the G20 agenda, as part of the B20 group of industry leaders. This was the first time a business leader from the cooperative sector has joined a B20 grouping anywhere in the world.

B20 is a platform which is part of the G20 Summit. It leads engagement with G20 governments on behalf of the international business community. Its main purpose consists in developing recommendations and issuing relevant commitments from business leaders and business organisations to deal with topical issues.  This year the B20 is being organised by the Australian B20 Leadership Group and will focus on developing a set of clear, actionable recommendations that drive global economic growth and create jobs.

Mr Shaun Tarbuck, ICMIF Chief Executive, is currently in Australia engaging with Dr Crane’s working group. He said: “Insurance is one of the largest and fastest growing parts of the mutual and cooperative sector and we are currently lobbying for involvement in global regulatory and legislative planning. Today’s announcement about the inclusion of mutualisation in B20 discussion documents is a huge step forward for the movement and will be of great significance to ICMIF members.”

Cooperatives and mutuals provide the world with highly effective, efficient, well-governed structures for owning and managing public assets. The mutual and cooperative insurance sector accounts for 27% of global insurance market share by premium.

Headquartered in the UK, ICMIF represents 225 values-based insurers in 72 countries with premium income of over US$250 billion. ICMIF is active in the microinsurance and takaful sectors.

Separately, the Bussles-based Global Federation of Insurance Associations (GFIA) has issued a statement saying that it supports the recommendations made by the B20 group on how private sector activity and investment can help the Australian G20 Presidency meet the ambitious growth targets agreed at the Finance Ministers’ meeting in February 2014.

“GFIA supports the B20 goal of stimulating growth by promoting investment in long-term infrastructure”, said Frank Swedlove, chair of the GFIA. “Insurers are natural long-term investors because of our business model. We welcome the B20’s recognition of the important role the insurance sector already plays in long-term financing. But we can do much more if the right policy environment is put in place.”

| Print | Share

Note that your comment may be edited or removed in the future, and that your comment may appear alongside the original article on websites other than this one.


Recent Comments

There are no comments submitted yet. Do you have an interesting opinion? Then be the first to post a comment.