Insurers make strides in climate-related disclosure

The insurance industry is making significant progress in disclosing their preparedness and response to climate change, according to the ClimateWise Principles Independent Review.

In this pivotal year for climate negotiations, and one in which the COP26 summit will be hosted by the UK, the review highlights the active role ClimateWise’s insurer members are playing in shaping international climate policy and regulation.

This year’s report for the group, convened by the University of Cambridge Institute for Sustainability Leadership, is the second year of reporting in full alignment with the recommendations of the Taskforce on Climate-related Financial Disclosures. It features a foreword from CISL’s Patron, HRH The Prince of Wales, who is said to have long understood the role of insurers in the fight against climate change.

The Review records a significant increase in average score – from 55% in 2019 to 65% this year – for the ClimateWise group of companies. This improvement in membership score is particularly noteworthy as it has occurred simultaneously with a 25% increase in the membership base, with ClimateWise welcoming seven new members in 2020 with the majority reporting against the principles for the first time this year.

Dominic Christian, chair of ClimateWise and global chairman, Reinsurance Solutions at Aon said: “Mandatory TCFD disclosure is coming and our members are building on their decade of experience of voluntary disclosures under ClimateWise. I am delighted to see our average score increase by ten per cent this year, reflecting both the goals of our growing membership and wider changes in the disclosure landscape. Yet we know the path is long and progress must rapidly be made.”

Huw Evans (pictured), director-general of the Association of British Insurers added: “Through our dual role as institutional investors and risk managers, the Insurance and Long-term Savings industry is uniquely placed to shape society’s response to climate change, which is why the ABI remains proud of our longstanding membership of ClimateWise.

“A 10% year-on-year increase in the sector’s performance against the ClimateWise principles will make a significant impact across the economy, especially as these principles align to the TCFD requirements. However, it is also clear from these findings that further progress is needed – and this will require a sustained effort across the sector. The ABI is committed to continuing to work with ClimateWise to drive collective action to both reduce the level of carbon emissions and make society more resilient to the threat of a changing climate.”

ClimateWise members include the ABI, Allianz, Aon, Argo International, Aviva, AXA XL, Beazley, Brit Insurance, the CII, Chubb, Ecclesiastical, Flood Re, Hiscox, Howden Group, Liberty Specialty Markets, Lloyd's, MS Amlin, M&G, Munich Re, Prudential, QBE, Renaissance Re, RSA, Sanlam, Santam, Sedgwick, Swiss Re, Tokio Marine HCC, Tokio Marine Kiln, Tokio Marine & Nichido Fire, The Hartford, Willis Towers Watson and Zurich.

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