Insurer
AXA will no longer provide insurance to three major oil pipelines and is quadrupling its divestment from coal businesses, moving further away from fossil fuels, it has been revealed today.
The insurance giant is divesting from 25 tar sands companies, and will quadruple its investments in environmentally-friendly projects by 2020 to €9bn (NZ$15.25bn), as well as further disinvesting from the coal industry,
Reuters reports.
The move was announced during the One Planet summit in Paris, called by French leader Emmanuel Macron to push forward the use of global finance in tackling climate change.
AXA was one of the first major financial firms to begin selling off coal investments in 2015, beginning with an initial €500m (NZ$847m) divestment.
“In 2015 AXA committed to reach €3bn (NZ$5.08bn) in green investments by 2020. Given that this target has already been reached, the Group has decided to quadruple its original target and reach €12bn (NZ$20.34bn) by 2020,” the firm said.
While AXA did not name the three major pipelines that it will no longer insure – which comes at a total of €700m (NZ$1.18bn) – they are understood to be in North America, a
Guardian report said. The insurer also revealed that it will not insure any new coal mines or oil sands projects, including associated pipeline businesses.
AXA CEO Thomas Buberl said the move was driven by both business and ethical reasons, and said that there is a need for big cuts in global carbon emissions.
“An increase of 4C is not sustainable and therefore also not insurable,” Buberl said of the predicted degree of warming worldwide. “And as father of two children, I really want to do the most I can with the company I am leading to get into a 4C world."
Speaking of the tar sands which the company has divested from, Buberl described their impact as wider than just heavy carbon emissions.
“They often present acute human rights issues, if you think about population displacement and also the local pollution they produce,” he said. “The pipelines will also be stranded assets at some point, so we don’t want to invest.”
French-based bank BNP Paribas, as well as ING in the Netherlands, have both also recently divested from tar sands.
Buberl said that AXA does not expect any change in the returns it makes on its remaining investments.
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