GHG Emissions - October 12, 2020
HSBC announces net zero target across customer base by 2050
HSBC announced Oct. 9 that it is committed to net zero emissions across its operations and customer base by 2050 and will be providing up to $1 trillion in green financing.
This move marks the strongest commitment made by a European financial institution to combat climate change, Reuters reported. A goal of this scale would require HSBC to reevaluate relationships with fossil fuel-related endeavors to ensure that the entirety of its financing portfolio is net zero. Reuters commented that such a task could prove challenging given the many Asian clients connected to or reliant on the coal sector that are integrated into HSBC’s portfolio.
Chief Executive Noel Quinn told the publication that HSBC intends to focus on expanding its capital markets-focused carbon transition policies to encompass all its activities across financing, asset management and corporate and retail banking.
“What we have given the market is an ambition that our total financing by 2050 will be net zero, that is a far bigger prize or goal than picking a sub-segment of our portfolio and saying ‘I am not going to bank you’ because that’s not what the world needs,” Quinn told Reuters. “That industry or that customer may then just go to Bank X, Bank Y or Bank Z. They won’t have changed their business model.”
HSBC plans to work with stakeholders to achieve their individual climate goals through the use of the science-based Paris Agreement Capital Transition Assessment tool and regular progress reporting. The bank also plans to invest $100 million in clean technology and donate an additional $100 million toward climate innovation ventures and renewable energy sources.