Governance
RLI Corp., (“RLI”) operates through its major subsidiaries RLI Insurance Company, Mt. Hawley Insurance Company, and CBIC, (the subsidiaries collectively “RLI Group”). RLI has always believed that good corporate governance plays a crucial role in achieving business success. The RLI Board of Directors adheres to best practices in corporate governance to fulfill its responsibilities to shareholders and oversee management and the Company’s business results.
RLI and its Board of Directors are committed to maintaining sound corporate governance. We invite you to review our corporate governance principles, practices and other corporate governance information.
Ethical Business Conduct
Our Code of Conduct, which applies to all employees and Directors, provides guidance on ethical business behavior to support our strong reputation as a leading specialty property and casualty insurance company. Annually, employees and Directors are asked to confirm they have complied with the Code in the last year. No waiver of the Code has been made for any executive or Director. We also maintain a Third Party Code of Conduct for our suppliers, vendors, consultants and business partners to communicate ethical business standards under which third parties are expected to operate when providing goods and services to RLI.
Climate-Related Risks
Governance of climate-related risks and opportunities is discussed in the Company’s 2022 TCFD Report.
Investments
We believe we have an obligation to our policyholders, employees, communities and investors to invest responsibly and ensure we are in a position to fulfill our commitments. We recognize that many factors can impact a business, and consider the sustainability of an issuer to be an important characteristic for investment selection. Climate change and its impact requires yet another viability lens as we evaluate current or potential exposures. Our investment policies, which are approved by the RLI Corp. and RLI Group Finance and Investment Committees, require both internal and external portfolio managers to consider ESG factors, including the physical and transition risks associated with climate, in the investment selection process.
Third-party tools allow us to monitor purchase activity and ongoing exposure, and identify climate-sensitive sectors in internal reporting. We have a growing portfolio of green bonds and continue to engage in investment opportunities in alternative energy or other transition beneficiaries.
Standing behind our strategic commitment to sustainable investing are our investment management partners for our externally managed fixed income portfolio, all of whom are United Nations Principles for Responsible Investment (UN PRI) signatories. All managers received an ‘A+’ score from the UN PRI for their approach to ESG Strategy and Governance. UN PRI signatories are committed to incorporating ESG issues into their investment analysis, decision-making, policies and practices. Additionally, over 72 percent of our equity portfolio is managed by UN PRI signatory firms.
Political Contributions
As outlined in our Code of Conduct, RLI prohibits contributions or gifts on behalf of the Company to be made to government personnel or regulators. All contributions to lobbyists, PACs or political candidates on behalf of the Company must be approved in advance by our Chief Executive Officer and Chief Legal Officer.
RLI is a member of the American Property Casualty Insurance Association (APCIA), the primary national trade association for home, auto, and business insurers. APCIA promotes and protects the viability of private competition for the benefit of consumers and insurers. APCIA works with several political action committees (PACs) to support their advocacy efforts on behalf of the insurance industry. A portion of our annual membership dues to APCIA are allocated by the organization to lobbying and other political activities, including political contributions. With the exception of these amounts, we do not generally contribute to lobbyists or political candidates.
