Climate Finance Policy Engagement Analysis
Climate Lobbying Overview: The American Council of Life Insurers (ACLI) appears to have engaged on emerging climate-related insurance regulations and broader climate-related finance policies, generally not supporting new regulations and requirements for insurers. It does not appear to have actively engaged on real economy climate policies.
Top-Line Messaging on Climate-Related Finance Policy: In comments to the Federal Insurance Office (FIO) in 2021, the ACLI contested the idea that climate change poses a risk to the life insurance sector or that climate impacts on the sector could imperil the stability of the wider financial system. In the same comments, the ACLI urged caution with regard to climate-related insurance regulation.
Position on Regulated Corporate Climate Disclosure: The ACLI has been generally unsupportive of regulated corporate climate disclosure. In 2021 comments to the SEC, the ACLI stated support for corporate climate disclosure requirements overall, but encouraged flexibility in reporting deadlines and frameworks for insurance companies. In 2022 comments on the SEC’s proposed climate disclosure rule, the ACLI was more unsupportive, suggesting Scope 3 requirements be less ambitious and certain qualitative disclosure requirements be eliminated. The ACLI also opposed climate disclosure bills in California in 2022 and 2023.
Position on Incorporating Climate Factors Into Investor Duties: In 2022 comments to the Department of Labor, the ACLI was unsupportive of the Department acting to require plan fiduciaries to consider climate risk in decision making, warning about "regulatory whipsaw effect" on plan fiduciaries. In comments on the SEC’s proposed ESG disclosure requirements for investment advisors and investment companies in 2022, the ACLI expressed “several concerns” with the proposal, including proxy voting and engagement disclosure requirements and Scope 3 emissions disclosure requirements.
However, the ACLI has also engaged on policies that seek to limit climate-related investing, opposing “anti-ESG” regulations in 2023 comments to the Wyoming Secretary of State and engaging with unclear positions on Florida anti-ESG legislation in 2023 and federal anti-ESG legislation in 2024.
Position on Incorporating Climate Factors Into Risk Management/Prudential Regulation: In 2022 comments on its first proposed redesign, the ACLI specifically requested that climate scenario discussions be removed from the National Association of Insurance Commissioners (NAIC) Climate Risk Survey. Also, in 2021 Not supporting incorporating climate factors into risk management/prudential regulation comments to the FIO, the ACLI stressed the uncertainty of scenario analyses and urged caution in using them in regulatory efforts, including in risk management and prudential supervision. In the same comments, the ACLI expressed its opposition to "overly prescriptive taxonomies" or frameworks for managing climate-related financial risks. In 2021 comments to the International Association of Insurance Supervisors (IAIS) ACLI advocated that climate risk management guidance must be "flexible" and avoid language that suggests "requirements," and asserted that public disclosure of climate-related information must be voluntary. It emphasized that insurance supervisors should not pursue "broader policy objectives of transitioning to low-carbon economies."
The ACLI also appears unsupportive of efforts to limit the use of ESG factors in risk management and underwriting activities, opposing a 2023 “anti-ESG” bill in testimony to the South Dakota legislature.
Position on Energy, Industry, and Land Transition: ACLI’s Q1 2024 Federal Lobbying Report shows engagement on the Inflation Reduction Act and Build Back Better Act but without disclosing a position on either policy.