Media release: QBE faces shareholder resolution after kicking climate can down the road

For immediate release: 19 February 2021

QBE’s updated Environmental and Social Risk Framework, released with its full year results today, includes oil and gas targets which ignore the urgency of the climate crisis and are out of line with the Paris Agreement goal of keeping warming to 1.5 degrees.

QBE will stop insuring new tar sands projects from 2022, but will allow business as usual in the rest of its oil and gas underwriting and investing until 2030 at the earliest.

Pablo Brait, campaigner at Market Forces said, “QBE is kicking the can down the road on climate action. Waiting nine years before assessing whether an oil and gas company customer ‘is on a pathway consistent with achieving the Paris Agreement’ is a complete abdication of responsibility. Business as usual until 2030 will guarantee the failure of Paris. All companies undertaking or planning new oil and gas projects or expansions must be refused insurance, as their activities are not consistent with keeping global warming below 1.5 degrees.”

“Market Forces has coordinated a shareholder resolution calling on QBE to align its underwriting and investment practices with Paris. QBE’s business as usual approach to the most urgent crisis humanity has ever faced means this resolution is more important than ever and the resolution will be lodged in coming weeks. QBE is being left behind by its competitors Suncorp and IAG, which are both already on the way to phasing out most of their oil and gas exposure.”

In contrast with QBE’s approach, Suncorp announced in 2020 that it would immediately stop all underwriting for new and additional oil and gas production and exploration projects, and would phase out all underwriting of oil and gas extraction by 2025.

“It’s no wonder QBE is hemorrhaging money when it takes 10 years to even start addressing the problem.” Mr Brait concluded.

Leading research organisations and the UN have found that between 2020 and 2030, global oil, and gas production must decline annually by 4% and 3%, respectively, to be consistent with the Paris Agreement’s 1.5°C warming goal.

In August, 25 leading scientists at Australian universities and institutions wrote that “to meet the upper Paris goal, we must achieve net zero emissions by 2040-2050. This requires a rapid phase-out of existing fossil fuel infrastructure, leaving no room for expansion of the gas industry”.

Last month, QBE increased its catastrophe allowance for 2021 by 24% to US$685 million, up from US$550 million in 2020, after its catastrophe claims suffered a 62% increase (to US$688 million) on the year prior. According to the insurer, the increase was driven by extreme bushfires and storm activity in Australia, which was also “a major contributor to the global losses” suffered by the company.