In June 2005, Allianz Group and WWF presented a joint report on climate change and its impact on the financial industry.
 | Picture of a tornado taken from the cover of the Allianz-WWF study |
The message was clear: climate change is real, the pace of change is accelerating rapidly, and this poses a serious business risk to the financial industry amongst others.
Joachim Faber, Allianz AG Board Member and CEO of Allianz Global Investors, the world’s second largest asset manager, responded to the report with concern. “Early action is needed to provide greater certainty for business, long-term investment, and technological change,” said Faber in June.
As part of the joint Allianz-WWF “Agenda for Action,” Allianz announced a stronger focus on alternative energies, which included a pledge to increase investment in renewable energies by 300-500 million euros over the next five years.
Robert Napier, Chief Executive of WWF UK, endorsed the pledge, and underlined the importance of the commitment. “The financial industry plays a pivotal role in helping to mitigate the effects of climate change and steer the world towards clean energy,” Napier said as the report was presented.
“WWF and Allianz want to cooperate further to develop new tools for climate risk assessment, and show how leading financial companies can help manage the transition to a clean energy economy.”
First steps, first investments
In December 2005, Allianz Group followed up on the “Agenda for Action” by making its first investment in a 72-megawatt wind farm project in Sicily, Italy. The wind farm is expected to begin producing energy in April 2007.
“Having announced our renewable energy investment initiative in June, it’s now very pleasing to be moving ahead with our first investment,” said David Jones, Chief Executive of Allianz Specialized Investments. “We look forward to developing further investments in the attractive and growing market for renewable energy.”
In order to tackle climate change risks more strategically, Allianz has created the Climate Core Group (CCG) headed by Otto Steinmetz, Chief Risk Officer of Dresdner Bank, a 100 percent affiliate of the Allianz Group. The task force advises the Board of Management, and examines climate change-related risks and opportunities in all business operations.
The CCG finalized the “Allianz Climate Strategy” in January 2006, thereby establishing basic guidelines for the management of climate change-related issues within the Group. The CCG is currently working on implementing a strategy that enhances existing environmental management systems, strengthens best practices, and further reduces GHG emissions.
Allianz and WWF will also explore how financial industries in the United States and Russia are responding to the challenge of global warming. The results of the research will be published in the summer of 2006.
Meanwhile, Allianz has built strong relationships with several other non-governmental organizations (NGOs) that know the issue of climate change, and that work with governments and businesses to reduce carbon emissions and increase reliance on renewable, “green” energy. It remains to be seen how Allianz will inspire other firms to forge relationships with concerned NGOs and international organizations, and work toward solutions to climate change – a truly global issue.
editor: Julia Leuffen
publishing date: February 8, 2006
