This is the second year filing this proposal. Proponents were informed verbally that it achieved a majority vote among subordinate shareholders last year, although unlike with its director votes, Fairfax did not break out this result by vote class in its filings. There has been no evidence of progress by Fairfax on the proposal content, nor any responsiveness by management or the board. Fairfax derives more than 3∕4 of its revenues from its insurance businesses but continues to significantly lag behind its insurance peers on climate risk management. Although Fairfax has stated that understanding climate change is critical to managing risk, an analysis of its disclosures, subsidiaries and major investments finds little evidence of climate-related risk management.1 Global insured losses have grown at more than twice the rate of GDP since 1994.2 The Canadian personal property insurance market experienced combined loss ratios of 101% for both 2024 and 2023.3 SwissRe projects that insured losses could double within the next decade.4 Fairfax itself incurred US$1.1 billion in catastrophe losses in 2024.5 Financed-emissions disclosure is a foundational risk management tool used by financial institutions to quantify portfolio level exposure to climate risk. Recognizing the financial importance of emissions disclosure, global peers have chosen to do so voluntarily. Peers such as AXA, Allianz, MunichRe and SwissRe provide such disclosure. Fairfax has indicated the growing capability to measure its financed emissions but the company has stated the results will not be disclosed to investors unless mandated by regulators.6 Fairfax subsidiary Northbridge will need to report financed emissions to the Office of the Superintendent of Financial institutions, but this will not be reported to investors and represents a small portion of Fairfax’s operations. Financed-emissions reporting builds the expertise to then undertake insurance-associated emissions disclosures,7 as peers such as Zurich8,AXAXL9 and Allianz10 have done. Fairfax is a significant underwriter of commercial enterprises, including both fossil-fuel and renewable-energy clients, and insurance-associated emissions disclosure would further enable investors to better understand the company’s exposure to transition risk. Peer insurers are using financed-emissions data to inform transition planning. Allianz excludes new oil and gas projects from both its investment and insurance portfolios,11 while other major insurers including Zurich,12 MunichRe,13 Suncorp,14 Generali,15 and others16 have committed to end or restrict underwriting for new oil and gas projects. In Canada, Cooperators recently committed to invest US$3 billion in climate solutions by year-end 2030, and reach 50% of AUM in impact or climate transition investments by year-end 2026, and 60% by 2030.17 Long-term value creation in the insurance industry is highly dependent on managing climate risk. Fairfax can begin to do this by responding favourably to this proposal. 1 2 3 4 5 6 https://www.fairfax.ca/wp-content/uploads/2023-Fairfax-Financial-Holdings-Limited-ESG-Performance-Report.pdf; https://www.investorsforparis.com/memo-fairfax-assessment-of-climate-risks/ https://www.insurancebusinessmag.com/ca/news/breaking-news/insurers-confront-growing-climate-losses-as-capital-pressures mount-in-canada-and-beyond-545635.aspx https://a.storyblok.com/f/339220/x/ba2a5efb46/personal-property-report.pdf https://www.swissre.com/institute/research/sigma-research/sigma-2025-01-natural-catastrophes-trend.html https://www.fairfax.ca/press-releases/fairfax-financial-holdings-limited-financial-results-for-the-year-ended-december-31-2024-2025-02-13/ https://www.fairfax.ca/wp-content/uploads/2025/04/250407_ESG_Report_FINAL.pdf#page=18 7 8 9 10 11 12 13 14 15 16 17 https://carbonaccountingfinancials.com/files/downloads/pcaf-standard-part-c-insurance-associated-emissions-nov-2022.pdf https://edge.sitecorecloud.io/zurichinsur6934-zwpcorp-prod-ae5e/media/project/zurich/dotcom/sustainability/docs/ sustainability-report-2024.pdf https://axaxl.com/-/media/axaxl/files/pdfs/about-us/corporate-responsibility/axa-xl-climate-report-2024.pdf?rev= 8794dae14e9d4100946e8d3175a4379b&sc_lang https://www.allianz.com/content/dam/onemarketing/azcom/Allianz_com/investor-relations/en/results-reports/annual-report/ ar-2024/en-allianz-group-non-financial-supplement-2024.pdf https://www.allianz.com/content/dam/onemarketing/azcom/Allianz_com/responsibility/documents/Allianz-Statement oil-gas-business-models.pdf https://www.insurancebusinessmag.com/ca/news/environmental/zurich-insurance-cancels-underwriting-new-fossil-fuel projects-484240.aspx https://www.munichre.com/en/company/media-relations/statements/2022/new-oil-and-gas-investment-underwriting-guidelines.html https://www.suncorpgroup.com.au/corporate-responsibility/sustainable-growth#:~:text=Suncorp%20is%20committed %20to%20no%20longer%20directly%20invest%20in%20companies,or%20gas%20exploration%20or%20production https://www.generali.com/doc/jcr:32646e34-90ae-48b5-90c1-32b97b85cc68/GENERALI%20GROUP%20CLIMATE%20CHANGE% 20STRATEGY_TECHNICAL%20https://www.generali.com/doc/jcr:32646e34-90ae-48b5-90c1-32b97b85cc68/ GENERALI%20GROUP%20CLIMATE%20CHANGE%20STRATEGY_TECHNICAL%20NOTE%200622.pdf/lang:en/ GENERALI_GROUP_CLIMATE_CHANGE_STRATEGY_TECHNICAL_NOTE_0622.pdf https://docs.google.com/document/d/1B1zuUw6s4Gye6fyNV7cQxhVkwv7lY16z/edit https://www.cooperators.ca/en/about-us/newsroom/2025-09-23#:~:text=GUELPH%2C%20ON%2C%20Sept., challenging%20impacts%20of%20climate%20risks.