'It's not you, it's me.' We've all heard it breaking our hearts, we might all have said it at least once - breaking someone's else's heart – but will it be insurers' message to polluters? As, in their quest to be good corporate citizens, the yield or dividends alone that these companies offer is no longer enough for an insurer to justify investing in them.
Net-zero vs carbon neutrality
There is a push, supported by the former governor of the Bank of England, Mark Carney, to differentiate 'net-zero' from 'carbon neutrality'. Given the nascent nature of these concepts, and the lack of alignment on definitions, Insurance Asset Risk is of the view that for now both terms define the balance of emissions with removals, and therefore we use them interchangeably in our coverage... for now!
'Net-zero' have become the two buzzwords in financial markets. It is the object of many CIOs' desires, but like any objectification there is a part of fantasy: What is net-zero exactly, and how is it to be achieved?
Insurance Asset Risk addresses these questions in its latest issue, out today and downloadable here.
There is no doubt that insurers have become vocal about their plans to reach carbon neutrality by 2050, in line with governments' targets. But a 2050 finish line is a long way away, even for long-term investors: how many CIOs will still be in their positions by then? How many members of the investment team will see that project to fruition?
And current pledges are mostly directed at customers, for now. It is all about being seen as a 'good corporate citizen' while staying ahead of the curve when regulators pick up the topic. And soon, they will. And insurers will have to speak to them, through regulatory and accounting filings – an entirely different ballgame.
Insurance Asset Risk's 2021 summer issue contains the highlights of a series of articles on net-zero and related challenges, which will be published on our website over the next few weeks. We will offer profiles with those entrusted with the responsibility of taking Rothesay with its £93.7bn ($130bn) investments, Allianz and its €790bn ($930bn) general account, and more insurers, down that net-zero path.
As with any journey, the question of whether one will reach its destination is crucial, and here 'the how' for CIOs decarbonizing their portfolios is the elephant in the room that needs answering. We will also attempt to tackle that question.
Will the love story last the test of time, or end in heartache? Well, Cupid is still taking aim...
Insurance Asset Risk net-zero webinar series
Insurance Asset Risk is hosting a webinar series on insurers' net-zero journey, the challenges they face and the solutions they find.
Here is the full list of webinars, now open for registration:
Tuesday 21 Sep | First considerations before embarking on the Net-Zero journey
Tuesday 28 Sep | What is a Net-Zero investment portfolio?
Tuesday 5 October | Policy and regulatory response
Tuesday 12 October | Data and net zero
Wednesday 20 October | Rules of engagement for Net-Zero
Tuesday 26 October | The role of third parties
For more information about:
Issue 1 – Are we there yet?
Issue 2 – Insurers' role in climate capital raising
Issue 3 – COVID-19 chills markets
Issue 4 – On the road to sustainable investing
Issue 5 – Central bankers bring back the bull
Issue 6 - Insurance investors "hear the train a comin"
For more information on the print issue, please email: subs@insuranceassetrisk.com.