AXA’s new climate strategy sets the bar high

Today, AXA is launching its new Climate strategy, an action plan containing an array of commitments, including measures to ensure its investments’ alignment with the Paris Agreement, a strengthening of its coal policy, and the launch of Transition Bonds to facilitate decarbonisation. ALL ARTICLES  |  Commitment
Nov 27, 2019

The signing of the Paris Agreement in 2015 at the end of COP21 was a historic first: 196 parties embarked on an ambitious course of action to combat climate change, calling on countries to transform their economy to limit the rise of global temperature to “well below 2ºC” above pre-industrial levels (now generally agreed as +1.5°C). Since then, AXA has engaged in a comprehensive program to reorient its financial flows in line with the Paris agreement, complemented by the launch of a new asset class, a green investment target and further coal restrictions.

24bn €
green investment target by 2023
and 100ME transition bonds
by 2040
Thomas Buberl
Chief Executive Officer of AXA

AXA has been a pioneer by setting up an ambitious climate change strategy, notably by starting to divest from coal, defining green investment targets, restricting coal-related insurance business and building collective action frameworks.These actions helped our industry to put climate change at the top of our collective agenda. But the climate emergency requires further efforts. Today we are launching a new phase in our climate strategy to accelerate our contribution to the transition towards a low-carbon and resilient economy, notably by focusing our sustainable finance efforts towards the energy transition of major industries. We are convinced that it is an absolute priority if we want to reach the objectives of the Paris Agreement.

A major focal point of the new climate strategy is AXA’s overarching framework to align its investments with the Paris Agreement, committing to a 1.5°C warming potential by 2050. Warming potential is defined as the impact that AXA’s investments may have on the climate, expressed in temperature, as explored in the 2019 Climate Report. Moreover, AXA will publish annual updates.

Another core element of AXA’s new Climate strategy is the reinforcement of its coal exit policy, which broke new ground in 2015 when AXA became the first mainstream investor to divest from the coal industry, then was already reinforced in 2017. The new coal investment policy tightens existing restrictions on coal investment and underwriting, and now includes a commitment to a complete coal exit by 2030 in Europe and the OECD, and 2040 in the rest of the world.

Finally, AXA’s Climate strategy formally launches the concept of the Transition Bond, which is intended to finance companies that are aiming to transition from “brown” to “green”, without achieving Green Bond eligibility status. These bonds will play a key role in supporting the energy transition towards a low-carbon society.

Focus on AXA's new climate strategy
Investing in a 1.5ºC world: aligning business with the Paris Agreement

AXA sets the target to align its investments with the Paris Agreement, thereby committing to achieve a 1.5°C warming potential by 2050. Read more.

Forming a bond: supporting the energy transition

AXA is pioneering the first-of-a-kind “transition bond”, a new financial instrument to unlock additional funds for the low-carbon energy transition. Read more.

Emergency exit: committing to coal phase-out

AXA’s new climate policy increases the stringency of its existing coal policy, tackling not only coal expansion and installed coal capacity, but also committing to a long-term total coal exit. Read more.

On November 28th, 2019, AXA won an award from the French Government - the “International Climate Reporting Awards” – rewarding AXA for the quality of its Climate Report. AXA also won the previous award, in 2016.

Tags: Commitment