Sompo rules out insuring coal businesses
Campaigners welcome announcement buy say the policy is silent on how Sompo plans to evaluate the credibility of transition plans at coal companies and fails to mention oil and gas businesses
Japanese giant joins Net-Zero Insurance Allianz and requires coal companies to set out greenhouse gas reduction plans but campaigners say pledges do not go far enough
Sompo Holdings has pledged not to insure and invest in coal businesses in its new climate action plan.
The Japanese insurance giant has also joined the Net-Zero Insurance Alliance (NZIA), an international initiative aimed at achieving net zero greenhouse gas emissions in insurance underwriting portfolios by 2050.
The new commitment means Sompo will no longer insure or invest in companies whose primary business is coal or oil, and gas extraction projects in the Arctic National Wildlife Refuge (ANWR), unless they establish a greenhouse gas reduction plan by January 2025.
In addition, the group will not underwrite or make any new investments in new or existing coal power plants, thermal coal mine projects or in oil and gas extraction projects in the oil sands or the ANWR.
The policy was welcomed by campaign groups, which said Sompo had become the first Asian insurer to rule out insuring or investing in coal companies.
But campaigners said the policy is silent on how Sompo plans to evaluate the credibility of transition plans at coal companies and it fails to mention oil and gas businesses.
Campaigners called on the company to strengthen the transition plan requirement to close all coal-related assets by 2030 in EU/OECD countries and by 2040 globally to align with science-based pathways such as the International Energy Agency net zero scenario.
Minyoung Shin, Asia co-ordinator of the Insure Our Future campaign, said: “Sompo’s enhanced coal policy is a statement the company is serious about its net zero commitment, unlike its NZIA peers, Tokio Marine and MS&AD, which continue to drag their feet on coal.
“The UN-backed Race to Zero campaign has made it clear you can’t commit to net zero while continuing to support the development of new fossil assets. We urge all Asian insurers to enhance their fossil fuel policies in line with the global standard.”
Last month, Sompo updated its climate policy ruling out new tar sands projects and energy explorations in the ANWR. But the policy did not extend to the vast majority of other oil and gas projects, climate campaigners said.
Insurer our Future said Sompo, Tokio Marine and MS&AD must follow their 10 global peers who committed to ban or restrict underwriting oil and gas projects.
Last month MS&AD announced it had joined the NZIA.
The NZIA is a member of the Glasgow Financial Alliance for Net Zero, a forum for financial institutions to transition to net zero.