June 29, 2023
"A new dimension is opening up with the decarbonization of insurance portfolios"
As a global insurer and investor, AXA is keeping pace with major social and environmental changes. Aware of this responsibility, the Group has made its pioneering commitment to preserving the climate and biodiversity a pillar of its strategy. Today, on the occasion of the publication of its latest climate and biodiversity report, the Group is announcing new targets.
3 minutes
What is AXA's climate policy?
Our commitment to the climate is long-standing and we are proud to have been pioneers in this field. Since the Paris Agreement in 2015, AXA has set itself concrete and ambitious targets to play its full part in the fight against climate change. First and foremost, as a company, by reducing its own environmental footprint, but also by making underwriting and investment levers for the transition to a low-carbon world. We have long been at the forefront of the underwriting challenges posed by climate change, integrating these issues into our solutions and services, as well as into our investment choices and internal methodologies. For example, AXA was one of the first companies to take action to protect biodiversity and combat deforestation through its underwriting practices.
What progress has been made on these commitments?
Because we can only improve what we can measure, we regularly report on the progress of our commitments, in particular through the AXA Progress Index. In 2022, we passed the €25 billion mark in green investments, out of a target of €26 billion by the end of 2023. Our target of one billion euros of investment in forests is also on track to be reached this year. And because we are a responsible company, we are aiming to train all our employees in climate issues by the end of the year. Nearly 90% of them have already taken this training.
AXA is announcing new decarbonization targets today. What are they?
We have several announcements. Firstly, we are stepping up our targets for decarbonizing our investment portfolio. From a reduction of 20% between 2019 and 2025 - a target that has been exceeded, since we have already achieved a 35% reduction by 2022 - we are now aiming for a 50% reduction by 2030 compared with 2019. On the insurance side, AXA will strengthen its offer and services to ensure the transition, by increasing its support for renewable energy installations and infrastructures, as well as developing sustainable solutions in the event of a claim and other products linked to the transition. These levers should enable us to achieve two unprecedented objectives by 2030. Firstly, to reduce the carbon intensity of the motor insurance portfolio (used parts, circular economy, etc.) for individuals insured by AXA in its main markets by 20% compared with 2019. Secondly, to reduce the absolute emissions of its largest Corporate clients by 30% and the carbon intensity of other customers by 20% in its core markets compared with 2021.
What is innovative about decarbonising the insurance portfolio?
The decarbonization of investment portfolios is now well established, and the momentum is excellent. However, a new dimension is opening up with the decarbonization of insurance portfolios. AXA has been a pioneer since 2021 in developing green insurance offerings in its non-life portfolios. The Group is going even further today with these new announcements, made possible thanks to the methodological work undertaken within the sector, in particular with the NZIA, which has resulted in a real innovation for our industry. Decarbonizing our insurance portfolios is an exciting challenge that will involve our businesses, our customers and all our external stakeholders. The full text of these objectives is available in the new edition of our Climate & Biodiversity report.
What can I find in the new edition of this report?
This report meets regulatory requirements and provides a transparent account of how our commitments have evolved from year to year. Two indicators in particular enable us to monitor the position of our investment portfolio in relation to the Net-Zero trajectory between now and 2050. Firstly, the Implied Temperature Rise, which measures the impact of corporate bonds and equities. It stands at 2.5°C, below the market (2.7°C). Then there is the Warming Potential, measuring the impact of government bonds. It stands at 2.0°C, half a degree below the market. In addition to these indicators, there are two new ones this year. We are publishing the exposure of our investment portfolio to fossil fuels, which represents 1.3% of its total. We are also publishing our Corporate Biodiversity Footprint, an indicator measuring the impact of our investments on biodiversity.
