"Australian Ethical intensifies dialogue with QBE regarding insurance coverage for fossil fuels: Disclosure planned"
In a series of engagements spanning over a decade, Australian Ethical, an Australian-based superannuation fund and investment manager with holdings worth $56m in QBE, an Australian-listed insurer, has been vocal about its concerns regarding QBE's fossil fuel underwriting policies.
The crux of the issue lies in Australian Ethical's assertion that QBE's underwriting for new oil and gas projects lacks an assessment for Paris Agreement alignment. This contention is based on the belief that QBE's continued and unrestricted fossil fuel underwriting is unjustified.
Australian Ethical's engagement with QBE, which began in 2016, has been marked by numerous meetings and shareholder resolutions. One notable instance was in 2019, when Australian Ethical co-filed a shareholder resolution at QBE, leading to a coal exposure phase-out announcement. However, despite these efforts, Australian Ethical has yet to receive definitive answers from QBE regarding its fossil fuel financing practices.
In 2023, Australian Ethical escalated its engagement by voting against the re-election of QBE's directors due to fossil fuel underwriting. This escalation continued into 2025, with Australian Ethical writing to QBE's board seeking clarifications over fossil fuel financing. Unfortunately, the response was disappointing, leading to further public pressure.
The concern here is that QBE's current underwriting portfolio, which accounts for nearly 50% in property and agriculture, sectors exposed to physical climate risks, continues to fund fossil fuel projects. This has drawn criticism from Australian Ethical, reflecting concerns about the insurer enabling fossil fuel expansion beyond science-based climate guidance.
In its 2025 stewardship report, Australian Ethical vowed to further escalate engagement with QBE. Following QBE's 2025 annual general meeting, this engagement moved into the public realm. Australian Ethical is questioning whether the board and management of QBE are making decisions in the insurer's long-term interests.
Shareholders aren't getting access to the information they need from QBE, according to Australian Ethical. The fund is calling on QBE to disclose how much of its current underwriting it expects to have to exit over the next three decades due to climate change. Australian Ethical hopes that a public outcry will increase pressure on QBE to address its concerns about fossil fuel financing.
The issue of fossil fuel underwriting is a critical piece of the puzzle for funding new oil and gas projects. As the world moves towards a more sustainable future, insurers like QBE face increasing pressure to cease underwriting fossil fuels due to the climate risks impacting their profitability and reputations. QBE remains one of the insurers criticized for continuing fossil fuel underwriting amid calls for the industry to pivot more decisively towards net-zero aligned policies.
In summary, Australian Ethical’s engagement with QBE has evolved into active public and shareholder pressure demanding that QBE curtail underwriting fossil fuel projects. As of 2025, QBE has not fully adopted policies to halt such underwriting, drawing continued calls for reform.
- Australian Ethical's ongoing concerns about QBE's fossil fuel underwriting practices extend to the lack of assessment for Paris Agreement alignment in environmental science.
- The fund is urging QBE to disclose specific financial information regarding its fossil fuel financing, as this data is crucial for assessing QBE's business strategies from a corporate finance perspective.
