Australian Ethical flags climate conflict of interest ahead of QBE Insurance AGM
A resolution co-filed by the superannuation manager says incoming chair Yasmin Allen served on QBE and Santos boards when fossil fuel financing policy was updated
‘Know your peril’, the insurer’s maxim goes. Physical climate risk – a peril insurance providers know all too well – is rising up the materiality ranks. In recent years, insured losses from natural disasters have exceeded $100bn, according to a recent MSCI estimate.
As shareholders in large insurance companies, investors are consequnetly pushing for improved physical risk management. The latest example comes from down under, where superannuation provider Australian Ethical is escalating complaints against QBE.
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Risk visibility
QBE – one of Australia’s largest listed insurers – will convene its AGM in two days. Ahead of the meeting Australian Ethical, which owns some $47m worth of its stock, has co-filed a resolution aimed at the company’s oversight of climate risks in its underwriting portfolio.
Australian Ethical’s concerns with QBE’s climate risk management goes back nearly a decade. In 2025, the fund went public with its complaints – marking an escalation in an otherwise behind-the-doors conversation.
Historically, concerns have centred around visibility. As an investor, Australian Ethical sought clarity on the financial implications of QBE’s fossil fuel underwriting.
Some clarifications did emerge. Nearly a year to date, in response to investor concerns, QBE told Australian Ethical that nearly 50% of its business was in agriculture and property – sectors with relatively high exposure to physical climate risk.
This time too, the visibility question has resurfaced. The resolution co-filed by Australian Ethical notes that QBE has conducted a 30-year forward looking catastrophe modelling exercise.
“Management should therefore have an indication of which insurance portfolios are likely to become exposed to a level of catastrophe risk that is above QBE’s tolerance. This information is highly relevant to investors”, the supporting statement claims.
“QBE has confirmed that exiting certain lines of business reduced climate related volatility across their portfolio”, explains Nathan Parkin, Australian Ethical’s head of equities.
“We would like to understand how much more of the underwriting portfolio is subject to heightened catastrophe risk, including more specifically, the risks of continuing to underwrite new oil and gas projects”, he adds.
Conflict of climate interest
Australian Ethical’s concerns are also grounded in competition concerns. QBE’s approach to fossil fuel financing, Australian Ethical views as ‘out of step’ with peers such as AXA, Munich Re, Zurich, Swiss Re and Allianz.
“QBE’s policy on underwriting new oil and gas projects lacks the ambition shown by their domestic and global peers*, applying no restriction of substance to oil and gas expansion”, says Amanda Richman, Australian Ethical’s ethical stewardship lead.
“This is an extraordinary direction of travel for a company whose core business depends on reducing, not increasing, exposure to risk. It raises questions about in whose interests this policy was written”, Richman adds.
This year, the asset owner is going a step further by highlighting a conflict of climate interest within QBE’s board-level governance.
Australian Ethical is flagging concerns with QBE’s independent director and incoming chair Yasmin Allen. Allen retired from a non-executive director position at Australian oil and gas producer Santos in February this year.
While noting her retirement from Santos, Australian Ethical’s resolution raises concerns that the 2025 fossil fuel financing policy decision was taken while Allen served on both boards.
In addition, the statement says, “at QBE’s 2025 AGM, in response to Australian Ethical’s questioning about potential conflicts, Ms Allen confirmed she does not recuse herself from board-level discussions about QBE’s oil and gas policy”.
Trading platform SIX has co-filed the resolution that intends to put QBE’s governance processes under the spotlight.
“It’s valid for shareholders to question: how much of this delay is the result of a conflicts management policy that allowed a director of a fossil fuel company to participate in decisions around their fossil fuel underwriting?”, notes SIX senior ESG manager James Alexander.
At the upcoming AGM, Australian Ethical and the 100 shareholders who have backed the resolution thus far, will hope for greater clarity on how the insurer manages board-level conflicts of climate interest.
It marks the latest escalation in a decade long back and forth with the insurer on why investor concerns with climate risk management have not yielded satisfactory results.
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