ESG PERFORMANCE IN THE INSURANCE INDUSTRY: A STUDY OF THE REPUBLIC OF NORTH MACEDONIA

Abstract

Introduction: The integration of environmental, social, and governance (ESG) factors within the insurance industry is increasingly recognized as a key determinant of financial stability, competitiveness, and sustainable growth. This research investigates how ESG performance influences risk management, investment strategies, and product development within insurance companies, with a specific focus on the insurance market in the Republic of North Macedonia. The study also explores the evolving regulatory landscape and the growing expectations of stakeholders regarding transparency and accountability in ESG reporting.

Methods: The integration of environmental, social, and governance (ESG) factors within the insurance industry is increasingly recognized as a key determinant of financial stability, competitiveness, and sustainable growth. This research investigates how ESG performance influences risk management, investment strategies, and product development within insurance companies, with a specific focus on the insurance market in the Republic of North Macedonia. The study also explores the evolving regulatory landscape and the growing expectations of stakeholders regarding transparency and accountability in ESG reporting.

Results: Findings indicate that ESG integration in North Macedonia’s insurance sector remains at an early stage, with varying levels of maturity across companies. Environmental and social aspects are less developed compared to governance practices. However, a growing recognition of ESG’s financial relevance and its role in regulatory compliance and risk mitigation is evident. The results also suggest that companies adopting proactive ESG strategies demonstrate improved resilience, reputation, and long-term performance.

Discussion: The study concludes that ESG principles represent not only an ethical and regulatory requirement but a strategic imperative for the long-term sustainability of the insurance industry. Strengthening institutional capacity, regulatory frameworks, and stakeholder awareness is essential to accelerate the transition toward sustainable insurance. Future research should focus on refining ESG measurement models and examining the relationship between ESG factors and financial outcomes in emerging markets.