Climate variability, the increased frequency and severity of certain extreme events, and the growing vulnerability of modern societies to natural hazards have thrown down the gauntlet, challenging us to adapt to climate change. Tackling and addressing the associated risks is a global and shared responsibility.
At SCOR, we are committed to fighting climate change. Through our current strategic plan “Quantum Leap”, we have pledged to make our investment portfolio carbon neutral by 2050, sending a strong signal that we intend to align our investment portfolio with a “1.5°C scenario” and hence contribute to achieving the ambitious and critical goals of the Paris Agreement. We have also extended our 30% exclusion threshold beyond coal, to oil sands and arctic oil. This limit will be progressively lowered to 10% by the end of the strategic plan.
RESILIENT TOGETHER: A CHALLENGE FOR THE FUTURE
As a (re)insurer, we are directly exposed to the risks associated with climate change on both sides of our balance sheets, as risk carriers on the liability side and as institutional investors on the asset side. On the liability side, a study published in early 2019 by the CRO Forum highlighted that the most severe scenarios of global warming could deeply transform our risk universe and raise insurability challenges for some risks. In addition to increasingly destructive weather events, climate change-related risks may include water risks, food insecurity, threats to biodiversity, forced migrations, social tensions, political crises, and so on. Climate change is likely to affect the well-being, health and mortality of populations and could possibly have an impact on the risk of global pandemics. On the asset side, (re)insurers must face the implications of climate change on their investments, considering both physical and transition risks.
SCOR constantly invests in the understanding and modelling of risks to push back the frontiers of knowledge and share insights into the main climate change-related risks threatening the world. In an ever riskier and more uncertain world, the (re)insurance industry has a leading role to play in working towards sustainable and responsible development. We need to walk the talk and act collectively now.
This Climate Report provides an overview of SCOR’s climate-related risks and opportunities as well as information on how our business model and strategy is resilient to climate risks.