In 2022, we embarked on a transformative journey towards sustainability, recognizing its global importance. Fidelidade’s approach to sustainability is comprehensive and deeply integrated into its overall company strategy, governance structure and decision-making processes.
As an important milestone in our wider ESG responsibilities, we have defined our journey towards Net Zero by setting-up NZ-aligned science-based emission reduction targets on our underwriting and investment portfolios as well as on our operations.
For the baselining and target-setting efforts on the underwriting and investment portfolios we collaborated with a third-party partner, the Boston Consulting Group (BCG) and followed global standards and guidelines. Specifically, for baselining we referred to the Partnership for Carbon Accounting Financials (PCAF) methodology, while for target setting, we referred to guidelines from market initiatives, such as the Net Zero Asset Owner Alliance. For the operational emission baseline, we collaborated with Carbone 4, also following the GHG Protocol. These targets are science-based, meaning they are in line with IPCC 1.5ºC scenarios and reliable industry approaches.
Our climate targets
1. Investments
We aim to be net zero in our investments by 2050. In line with other players in the market, we have set interim targets for 2030 on our investment portfolio and real estate portfolio:
– Investment Portfolio: Reach a 40% reduction of emission intensity, from the baseline year (2022), on our Listed Equities and Corporate Bonds portfolio
– Real Estate Portfolio: Achieve a 45% reduction of physical emission intensity, from the baseline year (2022), within our direct real estate investments portfolio
In order to reach these targets, we aim to actively steer our portfolios towards lower emissive companies and assets, for instance by allocating liquidity from matured bonds towards less emissive intensive issuers. Company engagement will also be a key lever to get better transparency on NZ transition plans of our investees and encourage emission reduction target-setting.
2. Underwriting
We are firmly committed to achieve net zero in underwriting by 2050.
Our interim targets to the emission reduction targets are:
– UW Commercial: Achieve a 30% reduction by 2030 in
emission intensity from the 2022 baseline within the
Commercial underwriting portfolio in Portugal.
– UW Personal Motor: Achieve a 26% reduction in emission
intensity from the 2022 baseline within the personal Motor underwriting portfolio in Portugal.
To enhance the effectiveness of our initiatives and achieve our targets, we will proactively engage with our most material clients to foster greater transparency regarding their decarbonization plans, deep diving into decarbonization and mitigation technologies they plan to leverage (e.g., sustainable aviation fuels for Airlines).
3. Operations
At Fidelidade, we aim to be a Net Zero company in our Operations by 2040, reducing our emissions and influencing change in the ecological transition by working with the different stakeholders. Specifically, we have set an interim target on our Scope 1 & 2 emissions and Business Travel (Scope 3) by 50% by 2025 in Portugal compared to baseline year 2019.
In the pursuit of our operational emission reduction target, we have identified a set of key mitigation technologies and initiatives designed to bring us closer to our objective.
Our commitment to environmental sustainability remains resolute, and we are dedicated to playing a meaningful role in addressing the pressing challenges of our time. It is part of the responsibility of entities such as the Fidelidade Group to boost the Paris Agreement.
Please find our net zero plan here.
Please find our Commitments presentation here