German Allianz AG will no longer offer its insurance services to, or invest its capital in, the coal industry, the Dax-listed company told press on Friday.
Chief executive officer (CEO) Oliver Baete explained the move by the Munich-based insurance and asset management company as a response to the 2015 Paris Climate Accord. The treaty calls for a transition away from energy generation technologies which produce high carbon dioxide (CO2) emissions like coal to limit the effects of man-made climate change to a two-degree Celsius increase in average global temperatures.
"We have now decided to take the next step," Baete said. Allianz had already ceased investing funds in companies which generated more than 30 percent of total revenue through coal mining or operation of coal-powered power plants back in 2015.
The CEO estimated that refusing to offer new insurance contracts in the coal industry with immediate effect would cost Allianz a "high two-digit" figure in the millions of euros.
The company plans to complete its exit from coal entirely by 2040 and will hold consultations with affected customers towards that end.
Although the wealth management division is not bound by the strict 2040 deadline for the coal industry, Allianz will no longer invest any of its own funds in companies which do not adopt their strategy in response to the global warming target set out by the Paris Accord. Energy companies which currently engage in both conventional and renewable production can keep their respective insurance policies for the time being.
"We want to be a responsible partner which supports the restructuring of the economy," a statement by Baete read. This meant that Allianz would have to eliminate all of its "coal risk by 2040", as well as becoming a carbon neutral company itself.
Several environmental initiatives have been pressuring insurance companies to divest from coal. Allianz is one of the world's largest insurance and asset management firms, recording global revenue of 126 billion euros (150.7 billion U.S. dollars) and 1.96 trillion euros of assets under management in 2017.
Chief executive officer (CEO) Oliver Baete explained the move by the Munich-based insurance and asset management company as a response to the 2015 Paris Climate Accord. The treaty calls for a transition away from energy generation technologies which produce high carbon dioxide (CO2) emissions like coal to limit the effects of man-made climate change to a two-degree Celsius increase in average global temperatures.
"We have now decided to take the next step," Baete said. Allianz had already ceased investing funds in companies which generated more than 30 percent of total revenue through coal mining or operation of coal-powered power plants back in 2015.
The CEO estimated that refusing to offer new insurance contracts in the coal industry with immediate effect would cost Allianz a "high two-digit" figure in the millions of euros.
The company plans to complete its exit from coal entirely by 2040 and will hold consultations with affected customers towards that end.
Although the wealth management division is not bound by the strict 2040 deadline for the coal industry, Allianz will no longer invest any of its own funds in companies which do not adopt their strategy in response to the global warming target set out by the Paris Accord. Energy companies which currently engage in both conventional and renewable production can keep their respective insurance policies for the time being.
"We want to be a responsible partner which supports the restructuring of the economy," a statement by Baete read. This meant that Allianz would have to eliminate all of its "coal risk by 2040", as well as becoming a carbon neutral company itself.
Several environmental initiatives have been pressuring insurance companies to divest from coal. Allianz is one of the world's largest insurance and asset management firms, recording global revenue of 126 billion euros (150.7 billion U.S. dollars) and 1.96 trillion euros of assets under management in 2017.
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