HSBC to Review Financing and Investment policies
HSBC announced plans to review its financing and investment policies. It has pledged to reduce fossil fuel financing and assess clients' transition plans whether to continue providing financing services to them. The bank has recently come forward with such an announcement following months of criticisms from green campaign groups over its approach to reducing financed emissions.
HSBC said it would consult with independent international financial bodies regarding how it should review financing and investment policies for carbon-intensive industries.
Once the review is done, the bank said it would introduce new policies for non-energy businesses operating in ecologically sensitive areas, including the Arctic and the Amazon rainforest.
The policy, HSBC said, will include a science-aligned phase-down of fossil fuel finance in line with limiting and capturing the global temperature to 1.5 degrees Celcius.
The bank stated that its immediate goal is financing the transition. As of now, there are no such commitments to scale down oil and gas financing by a certain amount within a set timeframe.
HSBC has stated that the fossil fuel firms should draft their net-zero transition plans. If they fail to come up with or what they have come up with have less ambitious targets than those set by HSBC, will face divestment.
Dr Celine Herweijer, HSBC group chief sustainability officer, said: "We believe we can have the biggest impact on climate action by actively engaging our clients on their transition, focusing on the need for robust and credible transition plans, and by providing the financing and advisory solutions that help unlock the investments needed. We know we need to transform the bank to achieve this, and we want to demonstrate the actions we are taking to make this happen.”
The bank also vowed to publish its Climate Transition Plan by 2023. The plan will detail the stakeholders on climate and emissions targets of fossil fuel firms and outline what is being done to avoid loopholes. It will report on the progress made as part of its annual financial reporting.