Climate and Insurance.org | takefive with Mark Way

Mark Way heads Swiss Re's sustainable development activities in the Americas and is part of the company’s Sustainability & Emerging Risk Management unit. He works closely with the topic of climate change helping to coordinate the issue within the company. From 2003 to 2006 he represented Swiss Re on the Climate Change Working Group of the United Nations Environmental Programme Finance Initiative.

In October 2006, Mr. Way relocated to Swiss Re's Americas headquarters in Armonk, NY to coordinate the company’s sustainability related activities in the United States, Canada and Latin America.

Mr. Way joined the Swiss Re Group in 1994 and has worked in various non-life marketing teams including those responsible for regions such as United Kingdom, Scandinavia and Japan. In 2003 he moved from Client Manager for Greece, Cyprus, Malta to the Group Sustainability Management unit. He contributes on a regular basis to publications and briefings on climate change, and sustainability and speaks often on the topics.

A British citizen, Mr. Way graduated from the University College Wales having studied International Politics and Area Studies in the United Kingdom and the United States. In 2005, he completed an advanced course in Sustainable Business practice at Cambridge University’s Programme for Industry, Cambridge.

Takefive:
Mr. Way, Swiss Re was one of the first insurance companies to identity climate change as an emerging risk some 20 years ago and to have climate change become an important component of the company’s long-term risk management strategy. Can you briefly explain the four strategic priorities of Swiss Re’s strategy?

Mark Way:
Swiss Re’s approach to climate change consists of a strategy with the four pillars you mention which are aimed at increasing understanding and awareness of the issue, addressing the problem by offering solutions and reducing our company’s carbon footprint. In other words, our climate related activities are aimed at:

Takefive:
In 2003, Swiss Re became the first major financial services company to launch a voluntary program to become greenhouse gas-neutral. Can you provide us with a status report on this initiative and examples of what your company and its employees are doing in this regard?

Mark Way:
Swiss Re Group launched its "Greenhouse Neutral” program in October 2003 with the goal to reduce Swiss Re’s CO2 emissions by 15 percent per employee within 10 years and to offset the remaining emissions through the purchase of high quality verified emission reduction certificates (VER) and certified emission reductions (CER) sourced from the World Bank’s Community Development Carbon Fund.

Based on 2007 results, it was decided to strengthen the goal by reducing Swiss Re’s CO2 emissions by 30 percent per employee until October 2013 and offset the remaining emissions on an annual basis.

Overall, Swiss Re has already reduced the company’s carbon emissions by over 25 percent from 2003 – 2007. In January 2008, a total of 230 000 tonnes of CO2e high-quality VER’s were purchased and retired for the first time. This amount off-set Swiss Re’s total emissions from October 2003 to the end of September 2007. Swiss Re can therefore claim to be a greenhouse neutral company since October 2003.

Swiss Re also sponsors its “COYou2 Reduce & Gain” program aimed at encouraging its employees to make their own personal investments in CO2-reducing measures to complement the company commitment to address climate change. In the United States, Swiss Re employees can receive subsidies of up to $3,300 for investments in environmentally friendly technologies such as hybrid cars, solar panels and purchases of Energy Star rated appliances, windows or furnaces.

The results of the first year are very positive, with more than 500 staff – around 5 percent of eligible employees worldwide – taking part in the program.

Takefive:
Last year, Swiss Re launched its Climate Adaptation Development Programme. Can you explain how this Programme works and what have been some of the company’s early success stories?

Mark Way:
The Climate Adaptation Development Programme (CADP) is designed to drive the development of a risk transfer markets in the emerging economies. It is a public private partnership (PPP) bringing Swiss Re together in a collaboration with the International Research Institute for Climate and Society (part of the Earth Institute of Columbia University) and the Millennium Promise Alliance, a non-profit organization which aims to lift rural African villages out of the poverty trap.

The programme was launched in recognition of the fact that the hardest impacts of climate change will be felt by developing countries. The goal of the project is to develop climate-related index based financial risk transfer instruments. Currently, the CADP product focus is on risk transfer solutions which protect small farmers from the drought-related failure of their harvests and resulting food shortages.

Insurance penetration in emerging markets is often less than half that of developed countries. At the same time agriculture plays an even more important role in these regions and accounts for around 50 percent of all employment and nearly 40 percent of total land area.

The weather-related products designed by the CADP are particularly well suited to meet the kinds of risks faced by rural areas of developing countries. The first step of the project has lead to 150,000 people being covered in Kenya, Mali and Ethiopia.

Takefive:
Swiss Re recently joined forces with Mobiliar, Switzerland’s largest property insurer, to offer individuals the opportunity to compensate for the carbon dioxide emissions of their own car. Can you explain how this cooperative venture works, and do you see a similar venture being introduced in North America in the near future?

Mark Way:
Based on the knowledge and experience Swiss Re has accumulated under the Greenhouse Neutral program and emissions trading operations, Mobiliar contacted us to jointly launch such a service for their clients.

The end product is an online service to offset carbon emissions in private motorized transport. Based on the fuel consumption, the yearly mileage and the fuel type, the CO2 calculator identifies the motorists’ yearly carbon outage. Motorists can offset these emissions by buying the offered carbon neutralization service.

Swiss Re takes over the responsibility to acquire and retire the necessary number of emission certificates to compensate for the motorist generated emissions. The certificates are purchased through Swiss Re’s own emissions desk and fulfill internationally recognized criteria.

In essence the product has been specifically designed for easy duplication and we are currently evaluating other markets where it could be launched, including the United States.

Takefive:
Finally, what are your thoughts on the US government’s efforts to address climate change? Will there be an opportunity to enact legislation in the next administration that will enforce curbs on carbon emissions?

Mark Way:
Swiss Re has long advocated for an international market-based framework to regulate and reduce global greenhouse gas emissions. This is essential if we are to successfully fight global warming and climate change. We warmly welcome the current debate and momentum being made towards similar legislation in the U.S. Congress.

Although the Lieberman-Warner bill (S. 2191) did not pass the Senate, the number of votes was more than a similar bill in 2005 and the presidential nominees of both parties have expressed support for this kind of legislation. For these reasons we are optimistic that federal legislation to address climate change in the United States is not far off and this will prove pivotal in the search for a wider global agreement.