UTRETCH, NETHERLANDS – 16 November 2022 – The Partnership for Carbon Accounting Financials (PCAF) is pleased to launch the Global GHG Accounting and Reporting Standard for Insurance-Associated Emissions. After one year of intensive work and discussion by the PCAF Insurance-Associated Emissions Working group, the PCAF Global GHG Accounting and Reporting Standard for Insurance-Associated Emissions is here. PCAF and the UN-convened Net-Zero Insurance Alliance (NZIA) collaborated to develop this urgent, and ground-breaking methodology.
The global, standardized methodology to measure and disclose the GHG emissions associated with insurance and reinsurance underwriting portfolios will give re/insurers the possibility to gain deeper insight into the risk profile of their respective underwriting portfolios, stimulate innovative approaches to decarbonization, and create comparability for stakeholders.
“The launch of this new part of the Global GHG Accounting and Reporting Standard for the Financial Industry is a key milestone. The PCAF Standard for Insurance-Associated Emissions is a foundational piece for many other climate initiatives in this important sector of the financial industry. We are very grateful to the 16 re/insurers that worked intensively together, supported by the PCAF Secretariat, to create this Standard. It is our task to implement it in order to achieve greater transparency and accountability of the re/insurance sector”
Giel Linthorst, Executive Director of PCAF Secretariat and Director at Guidehouse
Following a targeted consultation in March, and the public consultation in July/August the working group has finalized the attribution factors for commercial lines portfolios and personal motor portfolios. The Standard will allow re/insurers to measure and disclose GHG emissions associated with their underwriting portfolios and it provides guidance on emissions data, data quality, and reporting requirements and recommendations.
"The PCAF Standard for Insurance-Associated Emissions provides the re/insurance industry with methods to measure absolute greenhouse gas emissions associated with underwriting activities. Simplicity and the use of readily available data was top of mind in the development process. I'm confident that this will support the rapid adoption by the industry. The Standard can be applied to more than 70% of the global property and casualty primary insurance market and the working group aims to extend its scope. With the Standard insurers and reinsurers can monitor progress of underwriting portfolios towards net-zero by 2050."
Thierry Léger, Group Chief Underwriting Officer, Swiss Re
The Insurance-Associated Emissions Standard is part C of the 2nd Edition of the PCAF Global GHG Accounting and Reporting Standard which will be published in early December. The 2nd Edition of the Standard will include new GHG accounting and reporting methodologies for (part A) sovereign bonds, emission removals, (part B) capital markets facilitated emissions, and (part C) insurance-associated emissions.
“The role of insurance in decarbonization has long been overlooked but the PCAF Insurance-Associated Emissions Standard sheds light on this—we now have a yardstick to associate emissions in the real economy with insurance portfolios.”
Butch Bacani, Insurance Lead UN PSI which created the NZIA last year
Accompanying the launch of the Insurance-Associated Emissions Standard, PCAF is hosting two virtual launch events of the first version of the Insurance-Associated Emissions methodology. The virtual launch will feature keynote speakers who will provide a deep dive into the finalized method.
*** For more information, please contact:
Executive Director, PCAF
Programme Manager & Latin America Team Lead, PCAF
About the Partnership for Carbon Accounting Financials
The Partnership for Carbon Accounting Financials (PCAF) was launched globally in September 2019. Currently, more than 320 banks and investors have subscribed to the PCAF initiative. PCAF participants work together to jointly develop the Global GHG Accounting and Reporting Standard for the Financial Industry to measure and disclose the greenhouse gas emissions of their loans and investments. By doing so, PCAF participants take an important step to assess climate-related risks, set targets in line with the Paris Climate Agreement and develop effective strategies to decarbonize our society.
Learn more at: https://carbonaccountingfinancials.com