DLG receives approval from SBTI on plans to reduce greenhouse gas emissions

Insurer Direct Line Group (DLG) has received approval from the Science Based Targets Initiative (SBTI) for its plans to reduce greenhouse gas (GHG) emissions.

The group’s insurance brands include Direct Line, Churchill, Privilege and Green Flag.

DLG’s chief executive Penny James said that “tackling climate change” is not only good for the planet, but also for the “sustainability of our business”.

She added that receiving approval from SBTI was a “significant milestone in [DLG’s] net-zero journey”.

As part of the development, DLG has revealed new targets focused on the most carbon intensive areas of its business.

In terms of operational emissions, the group’s target for its properties and garage network is to almost halve absolute emissions by 2030 – based on 9,339 tonnes emitted in 2019.

Its projects currently underway include electrifying and heating cooling systems to run off renewable energy, replacing diesel with hydrogenated vegetable oil in recovery trucks, as well as removing gas consumption in spray paint booths by moving to electricity.

DLG currently owns a network of 22 garages and has offices throughout the UK – including its headquarters in Bromley, London and eight other locations.

Investment and real estate

The group’s investment portfolio targets cover 75% of its total investment and lending activities by monetary value as of 2019. DLG’s investment portfolio covered £4.5bn of assets out of a total portfolio size of around £6bn at the end 2019.

These targets cover corporate bonds, commercial property and real estate loans portfolios.

For corporate bonds, DLG has committed to aligning its scope 1 and 2 portfolio temperature score by invested value within its portfolio from 2.44°C in 2019 to 2.08°C by 2027.

For scope 1, 2 and 3, this equates to 2.80°C in 2019 to 2.31°C by 2027.

Scope 3 also includes the group’s supply chain within its direct control, in which DLG has set an internal emissions reduction target of 27.5% – aligned to a below 2 degrees scenario.

In real estate, DLG has furthermore committed to reducing GHG emissions from its real estate investment portfolio and commercial real estate loans portfolio by 58% per square metre by 2030 – this largely relates to the running of the buildings, including electricity and heating use.

Real estate loans targets cover 3% of DLG’s overall investmnet emissions. 

James said: “We have millions of customers, spend millions on our supply chain each year and our investment decisions can influence the assets we hold.

“It’s exciting to see the practical measures now underway to help the business reduce its emissions as that’s how we can build confidence and make further progress.”

The SBTi is a partnership between not-for-profit charity CDP, World Resources Institute, the World Wide Fund for Nature and the United Nation Global Compact. Together, the partners validate corporate targets in line with the goals of the Paris Agreement adopted in 2015.