ACCOUNTING AND DISCLOSURE OF CYBERSECURITY, ANTI-BRIBERY AND ANTI-MONEY LAUNDERING EXPENSES OF INSURERS

Abstract

In order to achieve sustainable economy, it is crucial that enterprises of all sectors of the national economy correctly and precisely fulfil the main requirements of the European Union (EU) Corporate Sustainability Reporting Directive adopted in 2022. Insurers, as financial enterprises, are obliged to disclose in their financial statements the three elements of sustainable development (ESG), and namely, what their environmental, social and corporate governance policies are, and in particular, what their governance policies to counteract terrorism and cyber-threats, corruption and money laundering are. The disclosure of more detailed information, according to the principle of “double materiality” introduced by the Directive, about the climate and society impact on the insurance business, on one hand, and the impact of the insurance business on the climate and society, on the other hand, is crucial for the users of this information – public organizations, governmental supervisory and regulatory authorities, insurance policyholders, reinsurers, counterparties, etc.
For the purposes of drafting reliable financial statements of insurers in accordance with the applicable financial reporting framework (IFRS/ IAS), it is necessary to structurally present information for risk assessment, their management and their impact, with specific measures in terms of the three sustainable development elements (ESG). This requires their adequate, true and fair accounting in the accounting books of insurers.
The financial information about economic resources spent, and liabilities incurred, by the insurers for the implementation of the policies they have established in relation to the three sustainable development elements, needs to be disclosed in all material aspects on the face of their financial statements or in the explanatory notes enclosed thereto.
The non-financial information for the anti-money laundering measures undertaken by the insurers, for their actions to ensure cybersecurity and to manage their environmental and social challenges, must be disclosed in a separate Sustainability Report enclosed to their financial statements for the reporting and calendar year 2025. This information refers to the insurers’ objectives related to sustainability; progress achieved in the realization of these objectives; the assessment of sustainability-related risks; developed strategies and systems for management of these risks and the measures undertaken for mitigating their unfavorable impacts.
The disclosure of further, better selected and more reliable and digitalized information for the three elements of sustainability by the insurers is a basis for decision-making by their management teams, shareholders and investors on sustainability-related issues.