As part of its updated climate strategy, Europe’s biggest bank, HSBC has announced that it will no longer finance new oil and gas fields.
This move, according to climate campaigners, means that HSBC has provided a new baseline for other major banks but urged the bank to go further as it said it would still offer financing to existing fossil fuel projects “in line with current and future declining global oil and gas demand” and would also continue to provide financial and advisory services to energy sector clients whilst assessing the companies’ plans to transition to clean energy.
“It doesn’t deal with the much larger proportion of finance it (HSBC) still provides to companies that have oil and gas expansion plans,” said Jeanne Martin from the campaign group ShareAction who also called for new proposals to address the issue of corporate-level financing for energy companies “as soon as possible.”
According to Aditi Sen, who is a climate and energy program director at the Rainforest Action Network, the group’s (RAN) research on fossil fuel funding shows banks headquartered in the U.S. are the biggest culprits when it comes to fueling the climate chaos every year but their commitments have not been strong.
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The group found that the most significant four U.S. banks together account for one-quarter of all fossil fuel financing identified over the last six years.
In a 2021 report by the International Energy Agency, investments in new coal mines, and oil and gas wells need to end immediately if the world stood a chance of meeting its commitment to the Paris Agreement of limiting global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit).
Also, fossil fuel financing from the world’s 60 largest banks has reached $4.6 trillion U.S. dollars in the six years since the agreement’s adoption, with $742 billion in fossil fuel financing in 2021 alone, according to the most recent Rainforest Action Network report.
Earlier this year a group of institutional investors found that several banks — including HSBC — would need to significantly step up their efforts on climate if the Paris goal is to be met.
Story was adapted from AP.
