Former UN Assistant Secretary-General on Climate Change, Janos Pasztor, says insurers must be included in the policy architecture of sustainable development

Wednesday, 10 February 2016

Until 30 January 2016, Janos Pasztor was United Nations Assistant Secretary-General on Climate Change, and had been appointed by the UN Secretary-General, Ban Ki-moon, to support efforts to achieve a successful agreement at the United Nations Conference on Climate Change (COP21) in Paris in December 2015.

In an exclusive interview immediately after COP21 with Voice, the magazine published by the International Cooperative and Mutual Insurance Federation (ICMIF) for members and stakeholders, Pasztor talks about his assessment on the role of the insurance sector, and specifically mutuals and cooperatives, in delivering the Paris agreement.

Pasztor said that when it comes to mitigating the impact of climate change the insurance industry has an obvious and immediate financial stake in the game. By pledging a rise in its climate-smart investments at the UN Climate summit in 2014 - from USD 42 billion to USD 84 billion by end of 2015 – the insurance industry had already transformed its mainstream asset management by placing more emphasis on climate risk, and the USD 84 billion goal has already been exceeded.

Pasztor went on to say that at COP21 there is an opportunity for the cooperative and mutual insurance sector to share how it is playing a leading role in doubling the industry’s investment in Smart Risk Investing. This provided an important signal for delivering a long-term culture of ‘smarter’ investment decisions. Pasztor added that the United Nations was looking forward to the trajectory by which the insurance sector will deliver its further commitment to increase the amount invested in climate smart investments to ten times the current amount by 2020.

Pasztor spoke about the dislike that investors and those involved in the deployment of capital have for the “unknowns, saying “they like certainty and risks that can be managed”. Pasztor said “The insurance sector can help to manage and transfer risk and protect against the potential financial downside due to losses so that businesses feel more comfortable operating and continue to invest in the low carbon future. As one of the world’s largest industries, insurers are best positioned to assess and analyze risk, influence risk reduction behaviours and develop products to ensure sustainability of business models.”

Pasztor’s belief is that the insurance industry will likely play an influential part in climate change discussions as an investor and also as part of Task Force on Climate-related Financial Disclosures (TCFD) announced by Mark Carney, Chair of the Financial Stability Board, at COP21.

The interview with Janos Pasztor can be read in full by downloading the latest edition of Voice magazine from the ICMIF website.

Other articles in this edition include:

  • Exclusive CEO Profile of Romana Abdin, Simplyhealth “Refreshing and renewing the business: How Romana Abdin is leading a major strategic review”
  • The Millenial Generation; Reaching tomorrow's customers today
  • Technology: Are we on top of the challenges?
  • Recognition for the mutual model: ICMIF's Global Manifesto is a rallying call for action

UN Secretary-General Ban Ki-moon announced in January that Janos Pasztor of Hungary would become Senior Adviser to the Secretary-General on Climate Change. In his new role as Senior Adviser to the Secretary-General on Climate Change, Mr. Pasztor will support efforts of the Secretary-General to mobilize world leaders and all sectors of society to implement the landmark Paris Agreement.

Image: UN Photo/Manuel Elias