The Cooperative Society Newsletter
November 2020, Issue 25
by E.G. Nadeau, Ph.D.
Those of you who live in the U.S. are probably familiar with a series of inane TV ads featuring an emu and his intellectually challenged human partner. The ads are for Liberty Mutual, a Boston-based insurance company that is one of the largest in the world.
It turns out that the company not only insures coal, tar sands, and other fossil fuel projects. It also owns at least one coal company in Australia. Among environmentalists, Liberty Mutual is considered both a bad actor and a sleazy one. Bad because for years it has contributed to worldwide carbon emissions, and sleazy because it pretends to be “sustainable” while continuing major involvement in fossil fuel projects.
As many of you know, I am a big proponent of cooperatives. Mutual insurance companies are close cousins of co-ops because they are (in theory) democratically controlled by their policyholders, very much like the one-member, one-vote control that cooperators have over their cooperatives. Thus, I am reluctant to badmouth members of the co-op family.
But, Liberty Mutual is no longer a mutual, and hasn’t been since 2001. At that time it changed its corporate status to a mutual insurance holding company. Without going into the down-and-dirty details, the company is no longer controlled by its policyholders but rather, primarily, by corporate executives and stockholders.
Mutual insurance companies can’t own non-insurance businesses, but mutual insurance holding companies can. Thus Liberty’s ownership of the Mount Ramsay Coal Company in Australia, which is drawing major criticism from local community residents for its environmental irresponsibility.
Closer to home, Liberty is also under fire for insuring Keystone XL, Trans Mountain, and other tar sands pipelines. In both the Australian and the North American projects, Liberty is not only a climate change villain, it is also harming indigenous people through its fossil fuel projects.
While a number of other major financial institutions and insurance companies have made commitments to cease their support for fossil fuel projects, Liberty continues to engage in greenwashing rather than meaningful action.
So, until Liberty’s egregious behavior ceases, I recommend that we all ignore the entreaties of the emu and his partner and buy our auto, home, and other insurance products elsewhere.