More Insurers Invest In Climate-Friendly Companies
December 01 2010 - 10:13AM
Dow Jones News
A growing number of global insurance companies associated with
the ClimateWise trade body are making an effort to invest in
businesses that are working to lessen their impact on climate
change, new research showed Wednesday.
Of the more than 40 insurance companies that signed up for
ClimateWise, 73% have complied with a set of principles and
sub-principles which incorporate climate change in making
investments, according to independent research done by
PricewaterhouseCoopers. This is up from a compliance rate of 61%
last year and 43% in 2008.
The results indicate an increasing effort on the part of
insurers to address climate change. The review didn't name which
insurers aren't complying and didn't measure how incorporating
climate change affected investment returns. Still, the report was
upbeat about the positive longer-term impact of a more conscious
effort to help the environment.
Launched by Prince Charles in 2007, ClimateWise is a group of
more than 40 insurers from around the world which is focused on
reducing the risks of climate change.
The members are mostly from the U.K., including Prudential PLC
(PRU.LN), Aviva PLC (AV.LN), Legal & General Group PLC
(LGEN.LN) and 15 Lloyd's of London insurers.
Other members include Aon-Benfield from the U.S., Tokio Marine
& Nichido Fire Insurance from Japan, Santam Ltd (SNT.JO) from
South Africa and Tryg AS (TRYG.KO) from Denmark.
"The headlines continue to be dominated by financial instability
and, sadly, a rise of so-called climate scepticism," Prince Charles
said in the report.
"While insurers are not banks, I am pleased to see that business
leadership in the insurance sector... has not used the financial
crisis as an excuse to lose focus and there is emphasis on the
continued importance of the climate change agenda," he said.
Paul Abberley, Chief Executive of Aviva Investors London, said:
"There is a real opportunity for insurers to use their investor
power to invest in opportunities that reduce global climate
risk."
Abberley said Aviva has been supporting a mandatory requirement
for large companies to report on their greenhouse gas
emissions.
"We believe that where carbon emissions are a material commodity
with a financial value, they should be properly defined, measured,
accounted for, audited and reported," Abberley said.
Abberley told Dow Jones Newswires that good investments "can
range from clean energy generation to the other extreme of more
energy efficient household appliances."
In a case study, F&C Asset Management was cited for engaging
with over 700 companies in 2009 and encouraging them to improve
their operations and limit their businesses' impact on the
environment.
Co-operative Insurance was also cited for engaging Australia's
International Power, a company it invests in, on the use of
carbon-intensive coal.
-By Vladimir Guevarra, Dow Jones Newswires; +44 (0) 2078429486,
vladimir.guevarra@dowjones.com
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