Swiss Re CEO emphasises need for global collaboration towards net zero goals

In a recent media call following the release of Swiss Re’s 2023 earnings report, Christian Mumenthaler, the CEO of the renowned reinsurance company, highlighted the inevitable transition towards achieving net-zero emissions globally.

Mumenthaler underscored the momentum behind this shift, noting the overwhelming consensus among industry leaders and participants at events like the Conference of the Parties (COP).

During the call, Mumenthaler referred to the Net Zero Insurance Alliance (NZIA), which had looked to define the technical carbon footprint of insurance products so that everyone is using the same methods.

However, progress on this front faced setbacks and Swiss Re and others left the alliance. Despite this challenge, Mumenthaler emphasised the necessity of collaborations to streamline efforts towards combating climate change.

“The collaborations within industry are more problematic, or easier to attack than collaborations that are really across the board,” Mumenthaler remarked.

He pointed out that while some sectors, particularly in the United States, might politicise the issue of transitioning to net zero, many other regions globally are more unified in their efforts.

Mumenthaler stressed the critical need for standardised frameworks and institutions to measure carbon footprints accurately. He lamented the absence of globally accepted standards and institutions, which has led to a fragmented approach with companies devising their own methodologies.

He remarked, “Unfortunately, we don’t have these institutions, which means that a lot of companies are looking towards whatever is being formed or looking towards defining some of the standards in absence of anything globally accepted on their own.”

While acknowledging the challenges of collaboration solely within the re/insurance industry, Mumenthaler remained optimistic about the progress towards achieving net zero. He suggested that while industry collaborations might face hurdles, they are not indispensable for making significant strides in the transition.

Mumenthaler’s remarks underscore the growing consensus among global leaders and stakeholders in the insurance and reinsurance sectors regarding the urgent need for concerted action to address climate change. As the world grapples with the imperative to reduce emissions and mitigate environmental risks, collaborative efforts remain crucial in shaping a sustainable future for the insurance industry and beyond.

Swiss Re was a founder member when the NZIA was launched at the G20 Climate Summit in Venice in 2021.

In May 2023, Swiss Re announced it will leave the NZIA, becoming the fourth major re/insurer to do so.

In November 2023, Swiss Re CEO Mumenthaler said, in the minds of the leaders of some of the world’s largest companies, there’s no doubt the transition to net zero will happen, but it’s important people understand the consequences of the steps.

Mumenthaler explained that for insurers and reinsurers such as Swiss Re that claim to want to be net zero by 2050, scope one means they must be net zero in emissions in their own operations, scope two is the need to have 100% green energy, but scope three is where it gets tricky. For many global companies, like Swiss Re, the large majority of their footprint is external, which is scope three – emissions associated with the company up and down its value chain.

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