• Sustainability
  • SustainableDevelopmentENG
  • Sustainable Environment
  • ImproveClimateGovernanceENG
  • The Intergovernmental Panel on Climate Change (IPCC) forecast that average global temperatures would increase by 1.5°C or more by 2030 at the earliest. China Life recognizes the extreme impact of climate change and considers it to be one of the most important business issues we face. In 2019, we became one of official TCFD supporters with the aim of using insurance industry strengths to mitigate and adapt to climate change.

    To strengthen our response capabilities to climate change, properly disclose our achievements and actions, and act in accordance with international trends, we use TCFD standards to show the impact of climate change on our operations and value chain. TCFD guidance focuses on four main areas: governance, strategy, risk management, and metrics and targets. We also include factors associated with guidelines that are important to our industry, namely insurance and property ownership. Using this framework, we strengthen the Company’s climate change governance and devise systematic methods to identify climate change risks and opportunities. By setting and tracking goals, we successfully lower potential impacts and prepare for future opportunities. At the same time, we respond to the climate change management expectations of our external stakeholders by obtaining the highest "Level-5: Excellence," for our maturity model for the Climate-related Financial Disclosures following the BSI TCFD conformity check procedures.

    Climate risk and strategy


    China Life adopts TCFD’s recommended framework to promote the supervision and management of actions that mitigate climate change via top-down approaches from the board of directors, CSR Committee, accountable departments, and administrative units. By doing so, the Company has effectively incorporated climate issues into organizational operation and executed accordingly.

    Structure and Responsibilities of Committee for TCFD

    The Company formulated the Environmental Protection Policies to promote environmental protection and build a low carbon corporate environment. In 2014, we established the Environmental Protection Committee, which consists of nine Company managers responsible for after-sales service, information, administrative support, and other important duties. The committee has one chairperson, one deputy chairperson, and seven other members (one of whom concurrently serves as the executive secretary to oversee the committee’s overall administration and meeting communication). In addition to formulating and revising committee rules and environmental protection policies, the committee monitors implementation of energy conservation and carbon reduction, waste management, environmental and health issues, and environmental protection.

    Environmental Protection Committee Organizational Framework

    In 2020, the committee convened twice to review implementation of environmental protection measures and establish environmental protection goals and guidance for 2021. The committee also reviewed and revised our Environmental Protection Policies to enhance environmental protection duties and improve the existing environmental performance management guidelines.

    Strategy and Risk Management

    When identifying climate change risks and opportunities, China Life simulated RCP 2.6 and RCP 8.5 scenarios proposed by the IPCC for physical risks, and 2DS and 6DS climate scenarios proposed by the International Energy Agency (IEA) for transition risks. By comparing the results of RCP 2.6/ 2DS scenarios, where active carbon reduction and sustainable energy system development are conducted, with RCP 8.5 /6DS scenarios, and where technology development is relatively limited due to current policies, the Company is able to assess the climate's potential impacts on sales, strategies, finance, and investment under different climate scenarios.

    China Life gathers various units to evaluate climate change’s impacts on operations and our value chain. We identify climate-related risks and opportunities then assess the impacts on the Company’s revenues, costs, and continuing operations. Each unit must analyze the probability of occurrence of various scenarios as well as the potential financial, operational, and strategic impacts. This information is used as a reference for determining associated risks and opportunities then crafting response strategies and action plans. Implementation and assessments follow. We must effectively control or reduce climate-related risks and take advantage of related opportunities in order to meet the expectations of stakeholders.

    Climate Risk Evaluation Results

    Each unit considered “probability of occurrence” and “degree of impact” then used these data points to determine three of China Life’s major climate risks. Strategists crafted responses based on risk characteristics, with the goal of adopting early management to reduce potential impact.

    Risk Category Risk Factors Description Scope of Impact Response Strategies
    Increasing concerns or negative feedback from stakeholders Investment in industries that have a reputation for high carbon emissions or pollution leads to concerns or negative feedback from stakeholders. Revenues
    • Monitor policies, laws, and market changes. Adjust investment handbooks when appropriate.
    • Investment research reports include CSR evaluations to adequately assess risk.
    Increasing severity of extreme climate events (such as typhoons and floods) and their impact on policyholders Extreme climate events lead to increased frequency and severity of natural disasters, raising the need for emergency relief among policyholders. Operational
    • Offer policy loan incentives, premium extensions, expedited claims, and other emergency relief measures to provide policyholders with immediate support.
    • Annual review of processes for supporting policyholders affected by major disasters. Make adjustments based on policyholder needs.
    Increasing severity of extreme climate events (such as typhoons and floods) and their impact on policyholders Extreme weather increases the severity of typhoons or floods while higher temperatures raise power usage. In addition to affecting office and data center operations, public utility (water, electricity, telecommunications) instability could interrupt operations. Operational
    • Formulate business continuity plans to maintain operations during typhoons or other natural disasters and to shorten the time needed for system restoration.
    • Regularly evaluate the impact of natural disasters on leased remote backup centers then request that needed improvements are completed in order to reduce extreme weather-related risks.
    • Complete at least one annual data restoration drill at remote backup centers.

    Climate Opportunity Evaluation Results

    Each unit considered “probability of occurrence” and “degree of impact” then used these data points to determine three major opportunities related to climate change. We poured resources into designing action plans for taking advantage of the opportunities that climate change may potentially bring.

    Opportunity Category Opportunity Factor Description Scope of Impact Action Plan
    Product and Service FinTech trends Use FinTech to provide low carbon services that meet policyholders’ expectations Operational expenses, time cost
    • Continue to promote digital low carbon services, including e-notices, e-service, e-policies, and mobile insurance applications to reduce paper use.
    • Use mobile insurance applications to reduce the processing period by an estimated 1.5 – 2 days.
    • Use mobile insurance applications to reduce the notification rate by 20%.
    • Use the cloud to interact with policyholders, which raises efficiency and reduces paper cost.
    Efficient use of Resources Green buildings Relocate offices to a new green building to reduce energy use Energy efficiency
    • In 2021, we will relocate Company headquarters to a green building, which will reduce energy use and improve our sustainability image.
    • Install 36 kW of solar panels at the new headquarters building, which we forecast will produce 47,552 kWh of green energy.
    Market Responsible investing and green energy investment Participate in the 5 + 2 innovative industries plan, invest in green energy, or purchase green bonds, which will increase our investment profit sources Revenues
    • Support the government’s 5 + 2 innovative industries plan by directly or indirectly investing NT$130.562 billion, with a significant portion going towards green energy technology.
    • Continue to evaluate renewable energy, public infrastructure, green bonds, and other related investments.

    Metrics and Targets

    To effectively implement climate change management mechanisms, China Life includes climate change management targets in the Company’s annual ESG objectives and checks progress twice annually.