SOURCE: Unfriend Coal
April 24, 2019
By Lucie Pinson
In November 2018, Generali stated that it was engaging with six coal companies since July 2018, and that it would only renew coverage from March 2019 for those that would present and implement a credible transition plan away from coal.
The end of Q1 has long passed, and Generali’s exclusion of Polish and Czech coal companies is now overdue. Unless Generali takes action ahead of its coming AGM, consistent with its 2018 commitment, the insurer faces the risk of being demoted in Unfriend Coal’s ranking of insurance companies’ coal policies.
Although Generali did not qualify what a“credible transition plan” looked like, it would be sensible to expect such a plan to align with science-based targets, consistent with the Paris Agreement goal of “limiting global warming to well below 2°C and to pursue efforts to limit temperature increases to 1.5°C above pre-industrial levels”.
This is even truer for Generali, given that its climate strategy refers to both the Paris Agreement and the IPCC report on a 1.5°C global warming in its very introduction.
If serious about climate science, Generali should mandate its coal companies to immediately stop investing in the development or expansion of coal plants and mines, and publish clearly articulated and detailed plans for the gradual closure of their existing coal assets over the next two years. This will permit the total coal phase-out, required by 2030 at the latest in the OECD and in Europe.
PGE, Europe’s third biggest CO2 emitter and owner of some of Europe’s dirtiest coal plants, is one of the six companies Generali engages with. Far from planning a coal phase-out, PGE is heading in the opposite direction,planning more than 5 GW of new coal capacity and the expansion of its lignite mines. PGE, who have had at least 7 insurance contracts from Generali since 2013, is a striking example of a company without a “credible transition plan”, and should have by now been excluded from Generali insurance support. Other companies including CEZ, Enea and Energa also have no strategies in place to exit the coal sector by 2030.
Almost a month after the end of the engagement process and despite a clear failure by the six companies to adopt a credible transition plan, Generali remains silent. Unless the Italian insurer publicly confirms that existing coverage for these six companies will be terminated and that no more investment or underwriting support will be provided, Generali will be considered as failing to comply with its 2018 commitments.
It was based on these commitments that the last insurance scorecard published by the Unfriend Coal campaign in December 2018 ranked Generali in second place for its policy on coal underwriting. A failure of compliance will lead to a severe downgrading of the Italian insurer, and relegate it far behind Swiss Re, Zurich, Allianz, AXA and QBE. Generali’s next AGM on the 7th of May will be a moment of truth.