UN Climate Change News, 28 February 2018 – Generali, a major player in the global insurance industry, has announced it will divest €2 billion from coal, adding further momentum to the global movement of companies and pension funds to shift assets towards low carbon.
Leaving the bulk of global fossil fuel reserves in the ground is crucial in order to achieve the central goal of the Paris Climate Change Agreement, which is to limit the global temperature rise this century to well below 2 degrees Celsius compared to pre-industrial levels and to pursue efforts to limit the temperature increase even further to 1.5 degrees Celsius.
The Generali Group has been a staunch supporter of climate action for a number of years. At the UN Climate Change Conference in Paris (COP 21), where the Paris Climate Change Agreement was clinched, Generali joined the Paris Pledge for Action.
The company aims to increase its exposure to green businesses and gradually divest from coal-related companies, committing to the following actions:
- Invest in €3.5 billion into “green sectors”, mainly through green bonds and green infrastructures.
- No new investments in businesses associated with the coal sector.
- Current exposure to the coal sector (approximately €2 billion), will be gradually eliminated through disposing of equity investments, and steadily eliminate bond investments by bringing them to maturity or considering the possibility of divesting before maturity.
- For underwriting, the range of products with environmental value will increase, maintaining a minimum level of exposure in the coal sector.
Generali Joins the International Movement for Divestment
The move is part of a growing international trend to divest from fossil fuel companies which has been picking up pace over the past months.
In January of this year, New York’s Mayor Bill de Blasio announced plans to divest the City’s USD 189 billion pension funds of fossil fuel assets.
During last December’s One Planet Summit in Paris, the World Bank pledged to stop investing in oil and gas exploration after 2019.
The issue was also addressed by more than 450 investor, company and capital market leaders at the Investor Summit on Climate Risk at UN Headquarters in New York City this month to map out the next steps for increased action on climate change.
“While we see divestment from fossil fuel assets at more than USD 5 trillion, last year, the global community invested another USD 825 billion in fossil fuel use. Once again, your voice and the actions you take will speed the pace with which countries improve the consistency and alignment of their approach,” said United Nations Deputy Secretary General Amina Mohammed at the New York summit.
Read the Generali announcement here.