Aviva Investors will look ‘unfavourably’ on attempts to protect profitability in latest climate change clamp down

This week, Aviva has warned over 1,500 companies that it owns stakes in, that it will hold them accountable at annual meetings if they prove too slow to meet climate and sustainability targets, reports Reuters.

Related topics:  insuring the planet,  Aviva
Protection Reporter
6th February 2023
Climate Change

In an annual letter to the chairs of these companies, Aviva chief executive Mark Versey said it was crucial that boards did not sacrifice longer-term goals because of short-term market risks such as rising inflation and possible recession.

‘Potential conflicts could arise in various ways, including securing reliable energy sources by locking in high-carbon capacity, or protecting profit margins by inadvertently damaging the long-term viability of supply chains,’ Versey continued.

Ahead of the season for annual general meetings, Versey said that Aviva would focus on how companies respond to the cost of living crisis in the wake of wake in Ukraine, the transition to low-carbon economy, and efforts to reserve nature loss. Aviva has warned that it could sell out its equity and bond holdings at companies that consistently fail to publish “robust and viable” climate transition plans that factor in the social upheaval caused by the recent global shift, amongst other requirements.

It also said it would look ‘unfavourably’ on attempts by boards to protect profitability and returns through a ‘disproportionate transfer of costs to employees, suppliers and customers’. 

This announcement reflects Aviva’s constant effort to become the leader in climate-related disclosures, having become the first major insurer worldwide to target net zero by 2040 as well as publishing its portfolio warming, climate-related risk analysis, and transition plan.

Most recently, Aviva announced the launch of its biodiversity policy, releasing a report outlining its policy commitments in addition to the complany’s investment and underwriting activity in relation to biodiversity.

READ MORE: Aviva discusses commitment to climate-related financial disclosures in latest TCFD Status Report

READ MORE: Aviva publishes first biodiversity report

During last year's AGMs, Aviva voted against 134 companies for not moving quickly enough on climate change, or for not disclosing enough about their efforts.

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