Munich Re pulls out of UN climate group, citing antitrust concernsPosted On: Mar. 31, 2023 10:55 AM CST
Munich Re Ltd said Friday it has exited the United Nation’s Net-Zero Insurance Alliance because of antitrust concerns.
“In our view, the opportunities to pursue decarbonization goals in a collective approach among insurers worldwide without exposing ourselves to material antitrust risks are so limited that it is more effective to pursue our climate ambition to reduce global warming individually,” said Joachim Wenning, CEO of Munich Re, in a statement.
Munich Re, the world’s largest reinsurer, was a founding member of the organization in 2021.
Members of NZIA, which includes about 30 large European and Asian insurers and reinsurers, pledge to transition greenhouse gas emissions from their underwriting portfolios to “net-zero emissions by 2050 consistent with a maximum temperature rise of 1.5 (degrees Celsius) above pre-industrial levels by 2100 in order to contribute to the implementation of the COP21 Paris Agreement.”
The pledge also requires members to support implementation of corporate disclosure and policy frameworks relevant to the transition.
In January, NZIA released its first “Target-Setting Protocol” requiring members to set and disclose their initial emissions-reduction targets for their underwriting portfolios by July 31.
In its statement, Munich Re said it is “sticking to its ambitious climate targets,” which include reducing greenhouse gas emissions related to its investment portfolio, refusing to insure new oil and gas fields, and gradually reducing its coverage of thermal coal-related exposures. The reinsurer previously said it had stopped insuring new coal-fired plants, coal mines and oil sand mines.
Insurers have come under increasing pressure from climate activists. Last week, activist group Insure Our Future wrote to 30 insurers and reinsurers, including Munich Re, urging them to stop underwriting new fossil fuel projects.
Lindsay Keenan, senior finance campaigner for the group, said Friday that the move by Munich Re shows the need for clarification or reform of global antitrust laws “to make clear that antitrust laws are not and must not (be) a barrier to prevent the urgent necessary action required to meet globally agreed commitments to keep global warming to a maximum of 1.5 (Celsius).”
NZIA members Swiss Re Ltd., the world’s second-largest reinsurer, and Allianz SE declined to comment on the move by Munich Re.
French reinsurer Scor SE said it has no plans to review its NZIA membership, and Zurich Insurance Ltd., which is also a member, said it “remains committed to its sustainability ambitions and to supporting the net-zero transition.”
NZIA did not immediately respond to a request for comment.