Every year, interested shareholders of corporations come together at companies’ Annual General Meetings, where directors of the company present the company’s financial performance and shareholders vote on proposed resolutions.

This year, investor Green Century Capital Management filed resolutions at three insurance companies, Chubb, Travelers, and The Hartford, calling on them to stop underwriting new fossil fuel projects. These three insurance giants are top insurers of new oil and gas projects and invest in fossil fuels that are driving the climate crisis.

Why this Matters:

This is the first time the US insurance industry has faced a broad  challenge from shareholders for its contributions to climate change. The resolutions are part of a growing shareholder movement against both fossil fuels companies and their financial backers, calling on all companies to align their business with a 1.5ºC pathway.

The International Energy Agency (IEA) has concluded that there is no room for any fossil fuel expansion in a 1.5ºC pathway–and without insurance, new fossil fuel projects cannot be built.

The role of insurers in climate change is increasingly on investors’ radars. Last year alone, natural disasters cost insurers over $100 billion. Additionally, investment bank Societe Generale found that ending coal underwriting can add billions to the value of insurers’ stock, and that ending oil and gas underwriting could provide an additional “green premium.” And for some investors, insuring coal is a red flag—the UK’s largest asset manager, Legal & General, divested from AIG in June 2021 because it continued to insure coal. As of March 1, 2022, AIG ruled out support for new coal.

The insurance resolutions filed by Green Century Capital Management call on each company’s board of directors to “adopt and disclose new policies to help ensure that its underwriting practices do not support new fossil fuel supplies, in alignment with the International Energy Agency’s net-zero emissions by 2050 scenario.”

What Happens Now:

All three insurers have tried to silence their shareholders by filing no-action requests with the Securities and Exchange Commission (SEC) in order to continue business as usual.

On March 26, the SEC rejected Chubb’s bid to silence shareholders on fossil fuel underwriting. This is a significant ruling in favor of the landmark resolution! We expect that The Hartford’s and Travelers resolutions will be approved shortly as well.

In this day and age, the impacts of climate change are becoming more and more ubiquitous. By fighting back against climate shareholder resolutions and ignoring contributions to climate change, insurance companies are actively harming frontline communities that face cumulative impacts from fossil fuel projects; flying in the face of climate science; and creating risks to the financial system as a whole.

For more information on key resolutions and votes, visit www.criticalclimatevotes.com/

For more information on key director votes, visit www.proxyvoting.majorityaction.us/

Stay tuned: We’ll add to this blog periodically with new developments!