Solvency II failing to make transition plans mandatory, ShareAction argues

Written by Adam Cadle

24/11/2023

EU policymakers have “fallen short” of delivering the Solvency II regulatory framework needed to “hold insurers accountable for the damage they pose to people and the planet”, ShareAction senior EU policy officer, Caroline Metz, has argued.

“Instead of mandating transition plans with clear emissions targets, the final text only requires most European insurers to develop ‘prudential plans and targets’ to address risks associated with climate change,” she added.

"EU policymakers have missed a crucial opportunity to require insurers to break their ties with fossil fuels, the primary driver of climate change. Yesterday’s (22 November) decision represents a step backward from the transparency rules developed in the past two years, that promised greater accountability for the financial sector's impact on people and the planet.

“The Solvency II revision was a golden opportunity to push European insurers to develop robust transition plans with clear emissions reduction targets. However, the compromise, which focuses solely on insurers’ management of transition risks and ignores insurers’ impact, falls well short of what is needed for society and our planet.”

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