Joachim Wenning, the CEO of the world’s largest reinsurance company Munich Re, has confirmed in an interview that the reinsurer will step away from investing in and underwriting coal related business.
Wenning tells German newspaper the Frankfurter Allgemeine Zeitung (FAZ) that Munich Re wants to follow a climate strategy that ties its own actions to the two-degree targets set under the Paris Climate Agreement.
As a result, the company has taken the decision to not invest in any shares or bonds issued by companies that produce over 30% of their profits from coal-related activities.
In addition Munich Re is to stop underwriting coal industry activities, Wenning said.
He explained to FAZ, “In the individual risk business, where we can see exactly the risks, we will in future no longer insure new coal-fired power plants or mines in industrialized countries.”
Other major reinsurance firms including Hannover Re and Swiss Re have already come forwards to announce their intentions to underwrite and invest less in anything linked to coal.
Swiss Re announced recently that it was implementing a thermal coal policy first revealed in June 2017, which sees the firm no longer provide re/insurance to businesses with more than 30% exposure to thermal coal across all lines of business.
The Swiss reinsurance giants announcement came after French domiciled reinsurer SCOR revealed in 2017 that it would cease underwriting new thermal coal mines.
And, in June, Hannover Re said it would divest from companies dependant on coal for more than 25% of its revenue, which, according to the Unfriend Coal campaign, means close to half of the world’s reinsurers had made commitments to step away from the energy source.
But at that time Munich Re hadn’t and it was reported that the reinsurer would continue underwriting coal business in spite of investor pressure to follow fellow reinsurers.
Now Munich Re has announced its intention to step back from investing in or reinsurer coal related business, which shareholder activists will be pleased about.
The company intends to work with businesses to help them become more climate neutral, “We want to support our customers in this change towards a climate-friendly approach,” Wenning will explain in the FAZ article that is to be published today.