Persefoni provides insurers with a single source of truth across their operating, financed, and insurance-associated emissions to help them to meet their carbon disclosure objectives. We help insurers address their regulatory obligations, and stakeholder expectations. We provide them with tools to help them to gain transparency and build strategies to improve financial returns by incorporating carbon into day-to-day decision-making processes.
The insurance industry recognizes the key role it can play in supporting the global transition to net zero and building societal resilience to climate change. Over the course of the last few years we have seen existing global industry forums and initiatives, such as the Insurance Development Forum (IDF) and the Principles for Sustainable Insurance (PSI) lobby for insurance companies to focus on their carbon footprint. Newly formed bodies, like the Net Zero Insurance Alliance (NZIA) and the Glasgow Financial Alliance for Net Zero (GFANZ), attract support and signatories from all over the world who are committing to net zero across operations, investments, and insurance portfolios by 2050.
With mounting pressure from governments, regulators, and market influences for climate mitigation and adaptation, insurers of all sizes now feel the need to calculate and disclose their carbon footprint.
Regulators are now taking a stance with respect to climate change. The increasing climate focus - combined with the proposed SEC climate disclosure rule for public companies in the U.S. - has accelerated action, elevating climate reporting to the boardroom. In the U.K., Lloyd’s of London introduced a requirement for insurance businesses operating in the market to submit their own ESG strategy to the Corporation, as part of the 2023 syndicate business planning process. These syndicate members must evidence a credible pathway to net zero underwriting by 2050. The need for carbon accounting is at an all time high, playing a key role in compliance as well as strategy formulation.
At the same time, emissions data can be catalytic in value creation across the insurance sector. Insurers can be empowered to identify and harness opportunities for innovation through new product development and policy enhancement. Furthermore, they can play an integral role in building climate change resilience at pace and scale across lines of business by providing insurance coverage for transition interventions, activities, and technologies.
Persefoni supports insurers in building out carbon disclosure practices having codified the Partnership for Carbon Accounting Financials (PCAF) — the global accounting standard for financed emissions — and is looking to replicate the same across insurance related emissions once the standard is finalized. We can help insurers develop a dynamic carbon ledger to capture emissions across operations, investments, and underwriting activities that is traceable, assurable, and in line with applicable regulatory reporting and disclosure frameworks.
What are Insured Emissions?
Insurers can take another step towards actualizing their decarbonization strategy by linking measurable interventions to their transition goals while tracking progress. Risk managers can leverage emissions data for transition risk modeling. Portfolio management teams can start incorporating carbon into investment decisions. Underwriters can start quantifying the impact of their policies on the real world and work with policyholders to understand where new product and service line needs exist in the context of climate change.
Upon calculating a baseline based on the best available data, the next step is to keep pushing for accuracy by collecting activity data. Insurers can also make Persefoni footprint data directly available to policyholders with high exposures such as those operating in difficult-to-abate sectors to calculate a footprint. We reduce the complexities of carbon accounting and lower barriers of entry for insurers and their stakeholders.
When you work with Persefoni, you have a team that understands the nuanced and specialized financial services industry. Persefoni's Climate Management and Accounting Platform (CMAP) is built by an experienced team of climate experts, technology professionals, and finance industry practitioners. Our teams’ carbon accounting credentials include deep experience in the financial services and sustainability sectors and strategic partnerships with climate consulting experts like Bain & Co and PwC. Integrations with reporting solutions such as Workiva have created offerings that are highly complementary to our solution.
Persefoni’s solution, built on decades of software expertise, is tailor-made to support such initiatives within the insurance community. We’re a software company that hires the best of the best when it comes to sustainability expertise and helping insurers by giving them the tools to help them set and achieve decarbonization plans. We’ve formed complementary partnerships across the financial services ecosystem to ensure insurers are well-placed to execute their world-class ESG plans.
Key Takeaways from Finance Professionals on the State of Climate Reporting
What we heard on the ground in NYC at Financial Executives International’s (FEI) Corporate Financial Reporting Insights (CFRI) Conference 2022
COP27: Better regulation needed to complement initiatives like Gfanz
The fact that initiatives like Gfanz are “cross jurisdiction” is also important “for speed and to promote standards,” said Persefoni's Kristina Wyatt