Aviva aims to reach carbon neutrality by 2040 in first for insurance sector

The undertaking “will inform every aspect of operations and investment decisions” at Aviva over the coming years.

The firm laid out its carbon commitments, with a proposed cut of 25 per cent in the carbon intensity of its investments by 2025 and of 60 per cent by 2030; this is ahead of 50 per cent cut required by the Paris Agreement, it noted.

The 2015 Paris Agreement aims to bring carbon emissions from countries and companies down to net zero by 2050, to limit global warming to 1.5 degrees Celsius above pre-industrial norms.

Aviva plans to track its progress towards its carbon targets through annual public reporting and will sign up to the internationally recognised Science Based Targets (SBT) initiative so its work can be validated.

Initial plans include expanding green investments and switching to renewable electricity in its offices and to electric or hybrid vehicles in its motor fleet.

By the end of 2022, Aviva said it will divest entirely from all companies which make more than 5 per cent of their revenue from coal unless they have signed up to the SBT initiative.

In addition, by the end of 2021, Aviva plans to stop underwriting insurance for companies making more than 5 per cent of their revenue from coal or unconventional fossil fuels unless, again, they are SBT signatories.

Aviva CEO Amanda Blanc said: “Aviva is taking bold steps to help tackle the climate crisis. As the UK’s leading insurer, we have a huge responsibility to change the way we invest, insure and serve our customers. For the world to reach Net Zero, it’s going to take leadership and radical ambition. And it is going to take Aviva to play our part.”

Business and energy secretary Kwasi Kwarteng said: “Businesses have a huge and vital role to play in tackling climate change. It is fantastic that Aviva is taking radical action across its business, which will help the UK eliminate its contribution to climate change and influence other businesses to move in the same direction.

“In order to reach our 2050 climate target, we must work with companies like Aviva to harness the strength of the UK’s world-leading financial sector to unleash the private capital necessary to reduce carbon emissions and support new jobs as the UK builds back greener.”

By 2025, Aviva plans to have invested £6bn in green assets, and £2.5bn in low-carbon and renewable energy infrastructure, as well as deliver £1bn of carbon transition loans.

Last week, the plane-maker Airbus said it would start reporting data on the estimated emissions produced by its aircraft over their lifetime, in what it claimed was a first for the aviation sector.