New criteria falls short of aligning with 1.5°C
San Francisco – In a SEC filing of “Additional Proxy Soliciting Materials” Chubb quietly updated its oil, gas, and conservation policies. RAN’s analysis, released ahead of Chubb’s Annual General Meeting Thursday, May 16th, has concluded that while the updates are a small improvement, the loopholes and narrow scope result in policies that continue to fall short of the global climate goal of keeping human-induced heating under 1.5°C and fail to address the impact of oil and gas operations on nearby ecosystems and communities.
“A major, immediate test case for Chubb’s newly announced midstream conservation standards comes in the form of the controversial East African Crude Oil Pipeline that bisects protected areas outlined in its new policy. We eagerly await public confirmation from Chubb that it will be excluding this project going forward.”
Chubb’s methane criteria now requires oil and gas clients to have a plan to manage methane emissions and put limits on emission intensity. The major loophole in this criteria is that it only applies to the oil and gas operational emissions, not Chubb’s overall insured emissions nor the Scope 3 emissions of its insured projects. In fact, Chubb’s Board of Directors recommends its shareholders vote against a shareholder resolution to require Chubb to disclose its Scope 3 emissions at its annual general meeting on May 16th. Two additional loopholes exist around compliance. The compliance expectation for oil and gas clients with annual revenues under $1B does not specify a timeline for meeting the criteria. The expectation for clients with annual revenues over $1B allows any client who can “demonstrate progress,” report and measure their methane emissions to presumably delay compliance long past 2030.
Similar issues were noted when analyzing Chubb’s new midstream oil and gas conservation standards. By focusing on narrowly defined boundaries of greenfields, Chubb fails to address the impact oil and gas operations have on nearby ecosystems and communities. It also fails to address the harms of existing projects.
To live up to its word and bring about the transition to a low-carbon economy it claims to support, Chubb must immediately cease insuring all fossil fuel expansion projects, regardless of whether they are located in conservation areas or have plans to reduce operational methane emissions. These are the urgent, near-term commitments on fossil fuels and Indigenous rights that Chubb failed to make in its latest policy announcement, as detailed in Insure Our Future’s annual letter to the insurance industry, released in April 2024:
- Immediately cease insuring new and expanded coal, oil, and gas projects.
- Immediately stop insuring any new customers from the fossil fuel sector which have not published a transition plan aligned with a credible 1.5°C pathway, and stop offering any insurance services which support the expansion of coal, oil and gas production even among existing customers. By the end of 2025, completely phase out all insurance services for existing fossil fuel company customers which have not published such a transition plan.
- Immediately divest all assets, including assets managed for third parties, from coal, oil, and gas companies which have not published a transition plan aligned with a credible 1.5°C pathway and scale up investments in a just, equitable, and rapid global transition to a clean energy economy.
- Immediately define and adopt binding targets for reducing your insured emissions which are transparent, comprehensive and aligned with a credible 1.5°C pathway.
- Explore ways to bring fossil fuel companies to court in order to make polluters rather than insurance customers pay for the growing costs of climate disasters.
- Immediately establish, and adopt as policy, robust due diligence and verification mechanisms to ensure clients fully respect and observe all human rights, including a requirement that they obtain and document the Free, Prior, and Informed Consent (FPIC) of impacted Indigenous Peoples as articulated in the UN Declaration on the Rights of Indigenous Peoples.
- Immediately bring stewardship activities, membership of trade associations and public positions as a shareholder and corporate citizen in line with a credible 1.5°C pathway in a transparent way.
Originally published on Rainforest Action Network‘s website.
