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British Bank HSBC Sets Stronger Climate Targets Following Pressure From Activist

British Bank HSBC Sets Stronger Climate Targets Following Pressure From Activist
Following pressure from activists who claimed they would abandon a resolution set to be placed for the bank's next shareholder meeting, British bank HSBC strengthened its climate targets and promised greater transparency about its progress on the issue.
HSBC announced that it would restrict funding to the fossil fuel industry in order to meet the aim of limiting global warming to 1.5 degrees Celsius above pre-industrial levels, and that it would begin publishing specifics of how it is achieving its goals next year.
As Europe's second largest lender by assets ramps up its efforts, HSBC, which has been under heavy investor pressure, said it will share broader sector-specific statistics on how its clients are reducing carbon emissions.
As a result, a group of investors led by responsible investment NGO ShareAction said they were dropping a resolution calling on HSBC to resolve policy loopholes.
"Today's commitments are an important step for HSBC that showcase the impact of shareholder engagement," said ShareAction Chief Executive Catherine Howarth, citing the fossil fuel financing and pledge to update the bank's fossil fuel policies.
Scientists have warned that if the world fails to meet its climate targets, irreversible damage will result, and HSBC responded this year by saying it would review all of its policies to ensure they represent best practise, including those related to oil and gas, the Arctic, and the Amazon.
"As Europe's largest provider of financing to top oil and gas expanders, HSBC must act decisively," Howarth said.
In February, HSBC announced that it would strive to reduce emissions related with loans to oil and gas clients by 34% over the next decade, as well as set targets for its capital markets funding.
HSBC's sustainability officer Celine Herweijer told Reuters that the bank's Climate Transition Plan, which will be released in 2023, will more directly link the targets to CEO remuneration.

Christopher J. Mitchell

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