Global banking and financial services company HSBC filed a climate change resolution today, containing an expansion of its climate policies, including the establishment of a plan to exit coal financing. The move follows a campaign led by responsible investment NGO ShareAction for a deeper commitment to climate action from the bank. HSBC climate proposals will be brought to shareholders for a vote at the company’s AGM on May 28.
In October 2020, HSBC announced a series of climate-focused initiatives, including a commitment to align its financing activities with the goals of the Paris Agreement, setting a target to reach net zero carbon emissions in its own operations and supply chain by 2030, and pledging to provide between $750 billion and $1 trillion in financing and investment to support its customers’ own decarbonisation and transition efforts.
In January, ShareAction led a campaign with a group of institutional investors representing $2.4 trillion in assets under management, and other individual investors, targeting HSBC for more action on climate change. The group filed resolution at HSBC, calling on the global banking and financial services company to publish a strategy and targets to reduce its exposure to fossil fuel assets. HSBC stated that the ShareAction led group has now agreed to withdraw this and support HSBC’s new resolution.
According to the new resolution, HSBC now aims to phase out the financing of coal-fired power and thermal coal mining by 2030 in markets in the European Union and OECD markets, and by 2040 in other markets. HSBC will publish its coal phase out policy by the end of 2021, and has pledged to work with ShareAction and the investor group in developing the policy.
Noel Quinn, HSBC Group Chief Executive said:
“We are delighted to be setting out the next phase of our net zero strategy in this resolution, and invite our shareholders to support us on this journey. We are pleased that ShareAction and a group of shareholders have agreed to support the resolution and would like to thank them for their positive ongoing engagement and constructive challenge and input as we have shaped the detail of our plans to support the direct financing requirements of our corporate clients in the low carbon transition. This represents an unprecedented level of co-operation between a bank, shareholders, and NGOs on a critical issue, with a positive outcome for all.”
Jeanne Martin, Senior Campaign Manager at ShareAction, added:
“Today’s announcement shows that robust shareholder engagement can deliver concrete results and sets an important precedent for the banking industry. Net zero ambitions have to be backed up with time-bound fossil fuel phase-outs and today HSBC has taken an important step in that direction.
“Our focus now turns to ensuring it delivers on these commitments. HSBC must ensure that its coal phase-out policy, to be published before the end of the year, includes a clear commitment to stop financing coal developers and top coal companies and to ask its clients to publish their own coal-phase out plans by 2023 at the latest.”
The post HSBC to Exit Coal Financing, Following Engagement with Shareholder Group appeared first on ESG Today.