STATEMENT: Chubb* announces new policy to restrict its underwriting of oil and gas sector. Green Century seeks details on how effectively it will reduce carbon emissions.
Andrea Ranger, Shareholder Advocate, firstname.lastname@example.org, 781-349-2813
Pam Podger, Communications Director, email@example.com, 860-822-3887
Boston, March 22, 2023 – The insurance company Chubb Limited announced a new policy Wednesday aimed at reducing methane emissions released by its oil and gas clients’ operations. Chubb declared it will no longer cover oil and gas projects in government-protected conservation areas found in the World Database on Protected Areas.
Chubb was the first U.S. insurer to adopt any restrictions on underwriting new coal mining, new coal plant construction and operation, and new risks for utilities burning coal. In 2022, Chubb announced it would no longer offer coverage for oil sands projects, either. It is now the first U.S. insurer to announce underwriting restrictions on extraction from conservation areas. In addition, Chubb says it plans to work with oil and gas clients on improving methane leak detection, eliminating non-emergency venting of methane, and reducing emissions from flaring.
“We welcome any new policy that will effectively cut emissions in line with what experts tell us we need to do to prevent the worst impacts of climate change,” said Green Century Funds President, Leslie Samuelrich, “But — and there’s a big but — it’s not clear whether Chubb’s new policy aligns its entire book of business with a 1.5 degrees Celsius scenario. We need to see more details to know whether this is an impactful policy or simply a diversion from our shareholder proposal, so we invite Chubb to further explain its new policy.”
Green Century Funds has negotiated with Chubb over the past two years, urging the company to stop underwriting new fossil fuel projects in alignment with the goals of the Paris Agreement. Each year, Green Century has filed a shareholder proposal asking Chubb to commit to phase out underwriting new coal, oil and gas projects. The 2022 proposal received 19.4% of the vote, a high enough percentage that Green Century could file again this year. Chubb has again appealed to the U.S. Securities and Exchange Commission, asking it to block Green Century’s proposal from appearing on this year’s proxy ballot.
“Despite Chubb CEO Evan Greenberg’s comments that its new policy is science-based, it’s unclear if or how the plan matches up with this fact: Global emissions need to drop nearly 50% by 2030 to avoid the worst effects of climate change,” said Green Century Shareholder Advocate Andrea Ranger. “Our shareholder proposal asks Chubb to take a concrete step forward to phase out underwriting new fossil fuel projects. Let me be clear: This does not rule out underwriting existing companies, projects or operations. Some energy companies may actually be developing low-carbon projects and Chubb should underwrite those risks. Nevertheless, underwriting new oil and gas supply amplifies medium- and long-term climate risk, which doesn’t add shareholder value.”
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°Green Century Capital Management, Inc. (Green Century) is the investment advisor to the Green Century Funds (The Funds). The Green Century Funds are one of the first families of fossil fuel-free, environmentally responsible mutual funds. Green Century hosts an award-winning and in-house shareholder advocacy program and is the only mutual fund company in the U.S. wholly owned by environmental and public health nonprofit organizations.
*As of December 31, 2022, Chubb Limited comprised 0.00%, 0.55%, and 0.00% of Green Century Balanced Fund, the Green Century Equity Fund, and the Green Century International Index Fund respectively. As of the same date, other securities mentioned were not held in the portfolios of any of the Green Century Funds. References to specific securities, which will change due to ongoing management of the Funds, should not be construed as a recommendation by the Funds, their administrator, or their distributor.
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