By Tommy Wilkes
LONDON (Reuters) – The Net-Zero Insurance Alliance (NZIA) has dropped all requirements for members to set or publish targets for reducing greenhouse gas emissions, the UN said on Wednesday, a major rewrite of its rules after American political pressure led to an exodus of members.
The NZIA is one of several United Nations-backed alliances that are meant to bring financial institutions together to advance efforts to achieve net zero carbon emissions by 2050.
But the group has come under pressure this year from some Republican politicians in the United States, who accuse it of violating antitrust rules and driving up insurance costs. More than half of NZIA members, fearing a regulatory and litigation backsliding, have quit since attorneys general in 23 Republican-led U.S. states sent a letter threatening legal action in May.
“Going forward, NZIA member companies are under no obligation to set or publish targets: instead, individual member companies will be responsible and publicly accountable for all targets they set, methodologies used to set them, the timeline in which they decide to publish targets, and the progress they are making,” the United Nations Environment Program (UNEP) said in a statement.
The statement confirms a Reuters report on Tuesday that the NZIA, which has fallen to 12 members from a peak of 30 after the departure of major companies such as AXA, Allianz and Tokio Marine, needed to relax rules in a bid to maintain the coalition. .
Under NZIA’s “target setting protocol” released in January, insurance members had until the end of July to publish emissions targets for 2030 using recommended target types and were required to then update their progress annually.
Watering down membership rules so drastically will alarm environmental activists who believe insurers are not doing enough to reduce underwriting emissions fast enough.
One campaigner said removing goal-setting requirements would reduce the NZIA to little more than a ‘talk shop’ and mark the alliance for how little it demands of its members compared to the other UN financial industry groups.
Insurers inside and outside the group say they remain committed to achieving net zero by 2050 and will independently publish emissions targets with updates on their progress.
French company AXA published its first emissions reduction targets for its insurance portfolio last week.
Members and non-members alike will be encouraged to use the NZIA target-setting protocol and its methodologies, but UNEP said the protocol will now be “a voluntary guide to best practice” to help build and compare decarbonization goals.
“Each company that chooses to be a member of NZIA unilaterally and independently decides on the steps on its path to net zero. Membership of NZIA does not involve any coordinated competitive conduct or exchange of security-sensitive information. competition,” said UNEP.
“NZIA members remain committed to the transition to net zero and engage with a wider community of stakeholders on the future evolution of NZIA,” he added.
(Reporting by Tommy Reggiori Wilkes; editing by Grant McCool and Bill Berkrot)