LONDON (Reuters) – HSBC will cut support for the coal industry in the developed world by 2030 and in the developing world by 2040, the bank said Thursday, bowing to investor pressure to strengthen fossil fuel financing.
Investors managing some $ 2.4 trillion in funds that filed a resolution earlier this year that would tie the bank to stronger pledges, have pulled the move back there. the sign that they have reached a compromise with the largest bank in Europe.
The new goals from HSBC also include short-term and medium-term targets on funding alignment with the goals of the infamous Paris Agreement on climate change.
HSBC’s announcement confirms how the world’s largest finance companies are shifting to public and political pressure to enter the fight against climate change, by reducing funding for fossil fuel companies and encouraging clients in other sectors to cut emissions.
As a result, the ShareAction venture group has withdrawn their move at HSBC’s annual shareholders ’annual meeting on May 28, and instead the borrower will submit its own resolution with the support of ShareAction and its co-filers, a group of 15 major investors including Amundi
“Today’s news shows that strong engagement with shareholders can deliver solid results and set an important precedent for the banking industry,” said Jeanne Martin, senior enterprise manager at ShareAction.
HSBC’s new commitments go beyond those made in October last year when the bank set out an ‘ambition’ to achieve zero carbon emissions by 2050, a goal that has been criticized by campaigners for not directly addressing HSBC’s lending to fossil fuel companies.
ShareAction said it won a major discount from the bank as HSBC now makes it clear that coal power expansion is not in line with the goals of the Paris Agreement, where it had previously been more in line with the need for clients to dive coal assets.
HSBC will report on its progress annually, it said Thursday, starting this year.
ShareAction targeted Barclays with a similar move last May, which was knocked down but added up 24% of the votes cast.