Europe is leading the way on coal divestment, with the continent’s largest insurer set to divest by 2030.
French insurance giant AXA will immediately cut ties with companies that plan to expand coal mining and power generation and will “severely restrict” insurance services for other coal companies in order to totally divest from coal in the EU and other OECD countries by 2030.
AXA will divest from coal throughout the rest of the world by 2040.
“These new policies are another encouraging sign that banks and insurers are feeling the heat from the public, shareholders and regulators to take meaningful action on climate,” said Patrick McCully, climate and energy program director for Rainforest Action Network.
None of the major US banks have any restrictions on corporate finance for coal power, nor on any project or corporate finance in the oil and gas sectors. Only two US insurers – Chubb and AXIS Capital – have restricted insurance for coal.
Mr McCully said that progress on the issue of fossil fuel divestment was “glacially slow”.
“Globally dominant financial institutions like JPMorgan Chase and Liberty Mutual continue to be grossly irresponsible in their full-blown support for the corporations that are destroying our climate.”
Italy’s largest bank, UniCredit, has also announced that it will stop directly financing new coal mining and power projects and restrict its corporate lending and underwriting for coal mining and coal power companies.
UniCredit has also become the first bank in the world with restrictions on deepwater oil and gas. Just yesterday, UniCredit had the weakest policies on fossil fuels of any of the major European banks.
But that might not be enough.
“Under its new sustainability slogan ‘Do the right thing!’, UniCredit has come a good distance on coal with the new policy,” said Antonio Tricarico of Italian NGO Re:Common.
“But to really do the right thing, UniCredit should follow up quickly with an explicit commitment to immediately stop financing coal expansionists, and a pledge to fully exit coal at the latest by 2030 in OECD countries and by 2040 elsewhere, as the scientific community is now insisting has to happen if we are to avoid runaway climate change.”
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