Climate Transition Plan and GHG Reduction Goals

Resolution Text

WHEREAS: The Intergovernmental Panel on Climate Change has advised that greenhouse gas (GHG) emissions must be halved by 2030 and reach net-zero by 2050 in order to limit global warming to  1.5°C and avoid increasingly severe physical, transition, and systemic risks for companies and investors. 

Property and casualty insurers have a unique relationship to climate risk. They underwrite policies for and invest in the fossil fuel industry, which is responsible for ~90% of annual global carbon dioxide emissions, while simultaneously writing policies meant to protect their customers’ homes and businesses from the impacts of climate driven catastrophes.1  The worsening climate crisis has provoked more frequent and severe catastrophes, harming insurers who then impose further costs onto already climate impacted customers.2 

AIG committed to reaching net-zero GHG emissions across its underwriting and investment portfolios by 2050 and committed to using science-based emissions reduction targets, aligning with the latest climate science to meet the goals of the Paris Agreement. In doing so, it recognizes the business imperative of reducing GHG emissions and preparing for the transition to a low carbon economy.  
 

Recent high profile reversals of company commitments to set science-based targets have prompted investors to seek assurance that companies have comprehensive strategies sufficient to meet their stated targets. Developing a climate transition plan is an emerging best practice that meets this 
need. Transition plans are forward looking, near- and medium-term sets of actions a company will take to align its GHG emissions, business strategies, governance structures, and external policy engagement with a 1.5°C scenario in a just and equitable manner.  
 

Over 4,100 organizations disclosed to CDP that they have 1.5°C aligned transition plans; however, only 45 percent were public, and only 12.6 percent covered key elements of credible transition plans.3 By preparing and publishing a credible transition plan, companies can mitigate reputational and regulatory risks and maintain investor confidence. 
 

RESOLVED: Shareholders request AIG issue a climate transition plan, above and beyond existing disclosures, describing how it intends to align its operations and full value chain emissions with the ambition of limiting global temperature increase to 1.5°C. The plan should be published on a reasonable timeline and at reasonable expense, exclude confidential information, and detail progress and any plan updates on an annual basis. 

SUPPORTING STATEMENT: In developing and implementing the plan, we recommend, at management’s discretion:  

•    Providing forward looking, near-term and medium-term strategies, metrics, and milestones for achieving the Company’s GHG emissions reduction targets across decarbonization, governance, policy advocacy, and just transition components;
•    Considering transition plan guidance by advisory groups such as the Transition Plan Taskforce, United Nations’ High Level Expert Group on Net Zero Emissions, and We Mean Business Coalition.

1 https://www.un.org/en/climatechange/science/causes-effects-climate-change
2 https://www.nytimes.com/2023/10/12/realestate/as-natural-disasters-get-worse-so-do-home-insurancepremiums.
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3 https://cdn.cdp.net/cdpproduction/
cms/reports/documents/000/006/785/original/Climate_transition_plan_report_2022_%2810%29.pdf?
1676456406. Pg7.