Five things to know about NN’s recent climate change projects

1.   Why does climate change deserve our attention?

In 2017, we have seen wild fires, heat waves, hurricanes and floods. Experts and other stakeholders are debating about how much of this is driven by climate change. However, no matter what the answers, predictions based on global warming suggest that weather-related events are likely to become more frequent and more intense in the decades and centuries to come.

To limit the adverse effects of climate change, governments adopted the Paris Agreement in 2015. The agreement includes a commitment to keep the increase in global temperatures ‘well below’ 2°C compared to pre-industrial levels, while striving to limit them even more: to 1.5 degrees. To accomplish this ,governments should strive to reduce greenhouse gas emissions as soon aspossible. A large number of businesses, including NN, have expressed their support of the agreement and the necessary transition to a low-carbon economy.

2.  What are example of how do we address climate change in our investments?

NN has integrated environmental, social, and corporate governance (ESG) aspects into its investment process. Long-term value creation is at the core of our approach. To strengthen the consideration of climate-related ESG factors, we initiated the following projects:

3.   How do we measure our investment footprint?

Asa financial services company, NN does not have a major impact on the environment. However, we do have an indirect  carbon footprint, through our large investment portfolio. The portfolio is held on behalf of ou rinsurance operations and our own capital, called our ‘proprietary assets’.

In order to learn more about climate-related risks, we performed a carbon footprint analysis on a large portion of our proprietary assets. This analysis, which was published in August 2017, creates a starting point for monitoring and evaluating the investment risks associated with carbon emissions. It also helps us to prioritise our dialogue and engagement efforts with the most carbon-intense sectors in our portfolio. By publishing the results and insights, we aimto contribute to the industry’s on-going learning on this topic. 

Read more about our carbonfootprint analysis.

4.   What does ‘Engagement on climate change’ entail?

NN believes that engagement is essential in the transition to a lower-carbon economy. Our carbon footprint analysis confirmed that the utility sector is one of the highest-emitting sectors in our proprietary investment portfolio. Since 2016, NN Investment Partners (NN IP) has been engaging with companies in this sector to drive them to make their business more resilient to climate change, and to transition to more sustainable sources of energy.

To expand our engagement efforts to other sectors and companies, as well as policy makers, NN has joined the Institutional Investors Group on Climate Change (IIGCC). This is a forum for collaboration on climate change for investors. NN IP participates in the IIGCC corporate programme, in which we engage in discussions about climate change risks and opportunities that companies face, as well as their strategies and performance in addressing and disclosing them.

See the IIGCC’s website here for more information.

5.   What are climate risk disclosures?

The Financial Stability Board (FSB) is an international organisation that monitors and assesses vulnerabilities affecting the global financialsystem. In 2015, the FSB formed the Task Force on Climate-related FinancialDisclosures (TCFD). The Task Force developed a voluntary framework that helps companies to disclose climate-related information in their annual reports.  

A consistent and comparable disclosure framework helps us, as an investor and insurer, to better assess climate-related risks and opportunities. NN Group therefore endorsed the final recommendations of the TCFD, which we republished in July 2017. This means that we commit to promoting these financial reporting standards to the companies in which we invest. It also means that weare taking steps to further align our future reporting with the TCFD recommendations.

  • Form could not be processed
Feedback

Our main brands