The PZU Group, as one of the largest financial institutions in Central and Eastern Europe, is aware that the insurance industry is important in the transformation of the economy towards zero emission. It intensifies its efforts and undertakes activities which are to contribute to mitigating climate change. This mostly concerns growing our product offering, rethinking the way it is delivered, and developing innovation in reducing environmental risk and mitigating climate change. The Group is investing in projects that support the climate transition, including the development of the renewable energy sector.
The strategic activities are being implemented based on analyses conducted, which have allowed us to identify opportunities and risks.
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In the Global Risk Report 2024 by the World Economic Forum1 extreme weather events ranked second among short-term risks. Environmental risks once again dominate the 10-year horizon. Among the top five longterm risks are 4 related to climate and the environment, these are: extreme weather events, critical change in earth systems, biodiversity loss and ecosystem collapse, and natural waste shortages. In addition, 2023 was the warmest year ever measured, as confirmed by data from the Global Climate Highlights 2023 report2 , based primarily on the ERA5 analysis dataset. In 2023, the global average air temperature was 14.98 degrees Celsius and was 0.17 degrees higher than 2016’s record high.
Compared to the 2022 conclusions, the authors of The Emissions Gap Report 20233 indicate that progress has been made since the signing of the Paris Agreement in 2015. Based on the policies in place at the time of the Paris Agreement, greenhouse gas emissions were projected to increase by 16% in 2030. The current projected increase is 3%. However, in order to meet the Paris Agreement’s 2030 targets, projected greenhouse gas emissions must fall by 28% for a 2°C pathway and by as much as 42% for a 1.5°C pathway. The report’s authors call on all nations to accelerate their efforts toward lowcarbon economies. They also point out that developed countries with greater capacity and responsibility for emissions will have to take more ambitious measures and actively support developing countries in their pursuit of low-carbon development.
According to the PIU report4 „A climate of rising losses. The role of insurance in climate protection and energy transition” in 2016–2021, insurance companies in Poland reported 273 natural catastrophes to the Polish Financial Supervision Authority, for which they paid out PLN 3.622 billion in claims. Most of them were local and the result of torrential rains, thunderstorms, hail and hurricanes passing over Poland, as well as flooding. The authors of the report predict that extreme events will become more frequent and their effects more severe.
The analyses of the above studies show that the effects of climate change will affect economic development and the condition of societies. As a result, insurance companies must take these trends into account when pricing insured events. Risks related to climate change, both the physical and those related to transformation, need to be more fully and expressly accounted for in the PZU Group’s management. On the one hand, they directly affect the PZU Group’s operations, but on the other hand, it is the PZU Group that can contribute to reducing the negative effects of climate change through its actions. Both perspectives will have a more and more important impact on the PZU Group decisions and financial results.
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Monitoring the efforts of international organizations
The PZU Group is monitoring the activities of financial institutions and international organizations, i.e., the United Nations (UN), Organization for Economic Cooperation and Development (OECD) and the European Commission.
By disclosing information and managing risks related to climate change in the financial sector, the PZU Group observes the provisions of the climate agreement entered into by 195 countries in Paris in 2015. A document of major significance as a guideline for action from the perspective of efforts aimed at reducing natural disasters is the “Action Plan on the Sendai Framework for Disaster Risk Reduction 2015– 2030 – A disaster risk-informed approach for all EU policies” (Sendai Framework for Disaster Risk Reduction 2015–2030).
When working over solutions to address environmental and climate change challenges, the PZU Group is also accounting for the efforts of the Polish government, and the assumptions found in the Energy Policy of Poland until 2040.
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PZU Group participation in sustainable development initiatives
The need to prevent climate change and adapt to the new conditions requires coordinated efforts by decisionmakers, businesses and the financial sector. That is why PZU takes active part in industry initiatives, is engaged in social consultations and issues opinions on draft acts concerning climate protection. In 2022, PZU became significantly more committed to external initiatives for sustainable development:
Since June 2017, PZU has been a signatory to the United Nations Environment Programme Finance Initiative (UNEP Finance Initiative). The global partnership between the United Nations Environment Programme and the financial sector serves the purpose of mobilizing the entire financial system (including the insurance sector) to act towards the achievement of sustainable development goals.
PZU has been working with the UNEP/GRID-Warsaw Center since April 2022. In 2023, PZU joined the next edition of the Climate Leadership programme for the second time. PZU’s commitment to the 2023 edition of the Climate Leadership programme was to expand educational activities and raise awareness among employees in the area of sustainable development. PZU has also become a partner in the 10th anniversary edition of the „Eco-City” programme, run by UNEP/GRID-Warsaw in cooperation with the French Embassy in Poland. The purpose of the initiative is to educate, inspire and exchange experiences between local government units, entrepreneurs operating in urbanized areas and experts in sustainable urban development. PZU has prepared and made available to all interested parties a compendium of the best trends and practices in sustainable urban development – „The Power of Our Cities”.
Since May 2022, PZU has been a member of the United Nations Global Compact – the largest global initiative supporting sustainable business. Another Member of UNGC is Bank Pekao. PZU was involved in the Climate Positive initiative coordinated by the UN Global Compact Network Poland and participated, among other things, in the Sustainable Finance team.
In June 2022, PZU joined the Partnership for Sustainable Development Goals, initiated by the Ministry of Development and Technology.
PZU continued its participation in the Responsible Business Forum’s Partnership Programme. The program is a platform for development, knowledge acquisition, and networking and sharing of best practices in the area of sustainable development. More than 60 sustainable development leader companies in Poland participate in the Programme. PZU is also involved in the Chapter Zero Poland initiative coordinated by the Responsible Business Forum. It is the Polish branch of the international initiative entitled Climate Governance established by the World Economic Forum. It was formed to raise awareness concerning the consequences of climate change for the business community and its impact on the climate.
PZU continues to be involved in implementing the assumptions of the Polish Offshore Wind Sector Deal and Sectoral Agreement for the Development of the Hydrogen Economy in Poland. These projects have been initiated by the Ministry of Climate and Environment. They constitute a platform for inter-sector collaboration for Poland’s economic development, enhancing the competitiveness of Polish commercial undertakings and developing initiatives to ensure Poland’s economic and energy security based on low and zero emission sources of energy. One Member of PZU Management Board serves as member of the Offshore Wind Coordination Council.
The PZU Group systematically takes part in the dialog on sustainable development and finance. A PZU representative chairs the Task Force on Sustainable Finance at the Polish Insurance Association (PIU). PZU also chairs the Natural Disaster Risk Management Team, one of whose tasks is to support the Polish Financial Supervisory Authority (UKNF) in defining climate change stress tests. PZU is also involved in the works of the Polish Sustainable Finance Platform at the Ministry of Finance.
In February 2024, TFI PZU joined the ranks of members of the Sustainable Investment Forum Poland (POLSIF), whose mission is to work for the development of the sustainable investment and finance market in Poland by creating and disseminating best practices in this area. Sustainable Investment Forum Poland (POLSIF) is a non-governmental organization founded in 2023 by representatives of leading investment fund companies, banks, private equity funds, industry organizations and chambers, and academia. POLSIF is part of the panEuropean organization – The European Sustainable Investment Forum (EUROSIF)25 (temat istotny).
ESG strategy indicator: Joining at least 3 new initiatives – promoting sustainable development
Level of implementation 2023: Participating in 7 new initiatives – promoting sustainable development
1. Preface – Global Risks Report 2024 | World Economic Forum (weforum.org)
2. www.climate.copernicus.eu/global-climate-highlights-2023
3. www.unep.org/resources/emissions-gap-report-2023
4. www.piu.org.pl/raporty/klimat-rosnacych-strat/