Allianz has just announced a goal of a 25% reduction in greenhouse gas emissions in relation to bonds and stocks held by policyholders. Allianz has presented this as an intermediate objective in its prior commitment to align these investments with the goal of carbon neutrality by 2050. Reclaim Finance calls on Allianz to demonstrate consistency and to commit to no longer invest in companies developing new coal and unconventional hydrocarbon projects.
Allianz intends to achieve this 25% target through “active dialog with the companies and specifications of climate protection targets. Emissions are also reduced by expanding investments in climate-positive technologies and by refraining from investments in carbon intensive business models.“. Allianz does not specify which sectors it is referring to, nor the specific objectives and demands that will underpin its shareholder engagement strategy.
A first step would be to stop investing in companies that continue to worsen the climate situation by developing new projects with high levels of greenhouse gas emissions, which are incompatible with the remaining carbon budget. For example, while Allianz’s policy still allows it to invest in companies that develop new coal mines and infrastructure, it would do better to follow the lead of AXA and adopt a comprehensive policy which totally exits the sector.
In addition, with oil and gas production needing to decline by 4 and 3% per year between now and 2030, Allianz should commit to no longer invest in companies developing new hydrocarbon projects, starting with those in unconventional oil and gas. This is a prerequisite to be taken seriously on the objective of achieving carbon neutrality.
Note that Allianz’s commitment only covers investments linked to insurance premiums and does not apply to assets managed by PIMCO or Allianz Global Investor, which are large asset managers and have no comprehensive coal policy.