2012 was the first year that Allianz as a Group fully neutralized its CO2 emissions. What is the aim of this strategy?
Karsten Löffler: The neutralization activity, which is supported by avoiding, reducing and substituting emissions where possible, is part of our wider climate change strategy. We have a target of reducing our emissions per employee by 35 percent by 2015 compared to 2006. Neutralizing our remaining emissions is a logical next step. Offsetting emissions is usually done through purchasing carbon certificates that guarantee emission reductions in developing countries where opportunities to abate CO2 are abundant but financial means are scarce. But we have opted to go a step further by directly investing into such projects.
So, what is the advantage of investing directly in carbon projects?
Roderick MacDonald: We could have just gone out into the market and bought the necessary number of CO2 certificates. Prices have dropped significantly and, at least from today’s perspective, we could get very good deals. But we strive to have a real impact in areas that are fundamental to the future of our planet and, at the same time, present a sound business case. So we have put time and care into selecting and co-financing the very best projects out there. In return, we get our own carbon credits and, if necessary, we can purchase additional credits from the carbon market.
What projects have you selected for neutralizing the Group’s CO2 footprint?
MacDonald: We have assessed many proposals, some of them were very good, but government approval processes can be long and circumstances have not always been supportive. For the time being, we have selected two projects – one in Kenya and one in India. In Kenya, we invested in a company that undertakes forest conservation in combination with development initiatives for the local population. The first project will prevent the emission of 36 million metric tons of CO2 – about 100 times the annual emissions of the entire Allianz Group. In India, we co-finance a set of energy-efficient lighting projects. They will help reduce residential energy consumption and avoid the annual equivalent emissions of 1 million cars in Germany.