The Climate urgency requires a new way of acting against global warming

The last few months have been marked by a new level of collective awareness on climate urgency and the need to engage in an effective transition to a green economy Across countries, citizens and young people have been asking government and industries to take stronger actions to drive the green transition. They are right!

At AXA, we have always been convinced that our industry has a key role to play to fight the causes and mitigate the effects of climate change.

At AXA, we have always been convinced that our industry has a key role to play to fight the causes and mitigate the effects of climate change. Back in 2015, we sounded the alarm in the financial sector and broke a taboo by starting to divest from the coal industry. Two years later, we strongly strengthened our commitments. We are proud of our achievements because these actions helped put climate change at the top of our industry’s collective agenda.

But, as I explained today at the AXA Climate Impact Day, the climate emergency requires a new way of acting against global warming. This is why, alongside industrial players and policymakers, AXA announced a new step in its climate strategy with a view to align our investment portfolio with the Paris Agreement by 2050 and drive the transition to a low-carbon and resilient economy. To succeed in this new chapter, we will use all the levers we can activate, in our asset management and insurance activities.

Aligning with the Paris Agreement is a profound and far-reaching decision that requires us to redirect our investments so that they finance activities that do not contribute to warming the atmosphere beyond 1.5°C, as required by climate science.

Aligning with the Paris Agreement is a profound and far-reaching decision that requires us to redirect our investments so that they finance activities that do not contribute to warming the atmosphere beyond 1.5°C, as required by climate science. For AXA, it means that we will gradually come to question how and where we invest, with a specific focus on the energy transition of major industries. We’ll also do it collectively, by joining forces with the “Net Zero Asset Owner Alliance”, a coalition of some of the biggest global institutional investors committed to transition their investments to the same “+1.5°C” target or “net-zero” greenhouse gas emissions by 2050.

The transition also requires new financial tools and capabilities to accelerate the emergence of greener industries and support industries which still have to transform their business model. To make this transformation a reality, AXA will notably double its green investment target to Euro 24 billion and launch a new asset class, transition bonds, that will usefully complement Green Bonds by funding the transition of companies towards low carbon.

Towards a 0% coal energy world

We will not be able to achieve the objectives of the Paris agreement without exiting from the most carbon intensive industries. This is a difficult decision: everybody wants to do more green business, but who is ready to reduce “brown” yet profitable business? Building on our past initiatives, we will further reduce our exposure to the thermal coal industry to zero by 2030 in the OECD and EU countries, and in the rest of the world by 2040.

We will not be able to achieve the objectives of the Paris agreement without exiting from the most carbon intensive industries.

Our societies are already feeling the effects of climate change. I am convinced that insurers have a key role to play in protecting the most vulnerable populations. Today, close to 90% of losses related to natural events in developing countries are not insured. We need to offer innovative products and solutions to bridge this protection gap.

With this new ambition in our climate policy, we hope to actively contribute to the transformation of our economy while inspiring other actors to engage in this collective journey with us. This is the right way to move at the right pace. There is no time to lose.

Read the press release.