Company disclosures (3)
Strategy for managing climate-related risks and opportunities
This year marks a significant milestone in the evolution of QBE's climate strategy. Building on the foundations established through our actions to date, we developed our first Climate Transition Plan. This plan outlines our ambition to support the transition to a net-zero economy by taking action in our underwriting and investment portfolios, and to achieve net-zero emissions across our own operations by 2030.
Board decision-making considerations
During the year, the Board reviewed and approved QBE's Climate Transition Plan, including QBE's climate ambition and strategies across investments, operations and supply chain, and underwriting. In doing so, the Board considered trade-offs relating to feasibility, timing and potential financial impacts, recognising the need to balance climate objectives with commercial, regulatory and operational considerations, whilst continuing to support QBE's customers.
Management's role in strategy execution
The GEC is responsible for the management and execution of the Group's strategic priorities, including managing climate-related risks and opportunities, and overseeing the execution of QBE's sustainability strategy and commitments.
Group Chief Financial Officer (CFO)
Responsible for the consideration of climate-related risks and opportunities in business planning, investment and capital deployment decisions, as well as reporting on climate-related matters in the Group's Annual Report in compliance with Australian Sustainability Reporting Standards.
Group Chief Underwriting Officer (CUO)
Responsible for the Group's underwriting and reinsurance strategy and governance, including the identification and consideration of climate-related risks and opportunities and the execution of portfolio optimisation initiatives in response to those risks and opportunities.
Climate risk management
Climate change is identified as one of QBE's top risks. QBE understands and monitors this risk through scenario analysis, development of a Climate Transition Plan, and uplifted sustainability governance to support mandatory reporting.
Effects on Strategy and Decision-Making
Strategy Refresh: In 2025, the Company refreshed its strategy with a renewed focus on growth, embedding decarbonisation across business operations:
Capital Allocation Framework Integration: Our strategy is underpinned by our capital allocation framework, which ensures that growth opportunities, decarbonisation projects and low-carbon fuel developments are advanced within a robust financial framework.
Decision-Making Integration:
- The CAF enables planning and decision-making that ensures shareholder returns and balance sheet strength while reinvesting in value-accretive growth
- Disciplined investment through rigorous assessment and phased capital allocation for climate-related projects
- CTAP expenditure of $136m in 2025 demonstrates integration of climate considerations into capital allocation
Strategic Horizons:
- Backfill, sustain and decarbonise: Decarbonisation embedded in first horizon
- Build and grow: Focus on establishing commercial carbon management services
- Low carbon fuels: Development as energy markets and customer demand evolves
Operational Integration:
- Climate considerations embedded in Santos Management System
- Regular tracking of delivery against climate-related plans and goals
- Cross-functional communication on climate issues across business groups
Under all pathways, we continue to see that the Group has a role in both:
- Security of supply: ensuring fuel and energy supply remains safe, reliable and efficient, and is secure as the energy transition progresses
- Energy transition: to develop, commercialise and deliver low carbon liquid fuels and alternatives, to support our customers through the energy transition.
We own and operate infrastructure that is critical in maintaining a reliable and competitive supply of traditional energies. Consumers and businesses depend on these products. Maintaining and investing in energy distribution infrastructure does not, in itself, increase demand for traditional fuels. Instead, it ensures supply security while the energy transition and demand for these fuels evolves.
The Board considers climate-related risks and opportunities when overseeing the Company's strategy and performance against strategic objectives, by taking into account climate scenario analyses and identifying initiatives that support the energy transition, such as investments in renewable energy, low-carbon liquid fuels, and circular economy programs.
The Board also sets the Company's emissions reduction ambitions and other policies that guide operational decision-making. This includes for example, the balance between pursuing climate-related opportunities and advancing the Company's own emissions reduction initiatives.
Our New Energies and Future Fuels teams assess emerging technologies and alternative fuel options to continue to develop our product portfolio beyond traditional fuels and position the Group to participate in new markets, including the manufacture and supply of LCLFs, and advancing our electrification solutions.
Our Commercial Team continue to work closely with our key customers to understand their energy transition needs so we can support and respond to changes.
In 2025, we established new supply chains for LCLFs across Australia utilising our existing infrastructure and piloted LCLF manufacture at the Geelong Refinery. These initiatives demonstrated our ability to pivot our existing infrastructure to respond to future demand for drop in fuel replacements.
We also opened Australia's first renewable hydrogen refuelling station, which also includes fast-charging for commercial EVs. These initiatives bring various technologies together to help reduce the carbon footprint of medium and heavy vehicle transport in Australia and prove potential new energies and income streams for the Group.
We continue to advance and learn from our EV charging offering across our retail network while diversifying our retail model towards convenience to materially grow this segment and mitigate reliance on gasoline sales.
We actively monitor climate policy developments and participate in consultation processes to understand potential impacts and opportunities and work closely with our commercial customers to understand their strategic and operational plans, helping us validate fuel‑demand forecasts and develop solutions that meet their needs.