Optimizing the Relationship between Profitability and Corporate Responsibility – The Case of the Allianz Group

Abstract In this paper there will be examined a relationship using Allianz Group’s sustainability and financial reports from 2019 to 2023, focusing on key financial and ESG indicators. The existing literature shows combined findings between the ESG and the financial performance link. While some studies suggest a positive correlation, there are some that highlight industry-specific variations. However, some voids in the research remain regarding ESG impacts over the financial metrics in the insurance sector. This study employs multiple linear regression (OLS) to analyze ESG-financial performance relationships. Three models assess the effects of renewable energy, dNPS, employee satisfaction, Solvency, and GHG emissions on operating profit, RoE, and also EPS. Due to the small sample size and some possible effects of extreme values of the OLS estimates, there was a robust regression method implemented for the results validation. There are findings showing that renewable energy has a positive over the operating profit, on a moderate scale. The social factors, particularly dNPS, negatively correlate with profitability, most likely because of the high customer experience costs. Solvency emerges as the strongest predictor of financial stability. Even though there are statistical limitations, this study’s results suggest ESG integration can enhance long-term financial outcomes. Future research should explore larger datasets and macroeconomic factors to assess ESG’s lagged effects on profitability. Also, because of the statistical limitations, the results should be considered in more exploratory terms then definitive ones, serving as a foundation for future research which might include bigger datasets and companies for a bette result.