By Daniel Macmillen Voskoboynik, Campaigns Officer – Climate, ShareAction

Here at ShareAction, we’ve been excited to launch our new report: Banking on a Low Carbon Future, written by our very own Juliet Phillips and Sonia Hierzig. The report provides investors with guidance on how to engage with banks on climate change.

If we want to stay well below 2°C of global warming, as enshrined in the Paris Agreement, huge amounts of capital will have to be pulled away from high carbon assets and poured into the low carbon transition. New technologies will need to be financed, new infrastructure erected, and high carbon industries will have to transition away from their old business models.

The scale of this shift of capital is enormous: according to the International Energy Agency, we need to spend US$359 trillion by 2050 to avoid catastrophic climate change.

Banks, the stewards of the financial system, play a pivotal role in the movement of money across the global economy. All investments are statements about the future, and the money banks move today defines the world of tomorrow. This means that in terms of climate change, banks hold many of the keys to failure or success. The investment decisions they make will go a long way in determining whether we will face runaway climate chaos or a timely transition to a safe future.


According to the International Energy Agency, we need to spend US$359 trillion by 2050 to avoid catastrophic climate change.


Currently their action is insufficient. Rather than leading the way, many financial institutions are playing a major role in cementing the causes of climate change: financing high carbon energy projects or agricultural ventures that drive deforestation. But by tilting their investments away from these high-risk areas and financing low carbon solutions, banks can take advantage of emerging economic opportunities and reduce risk levels across their portfolios and the wider economy.

The case for action is not just environmental – it’s also financial. If banks fail to act, they risk invoking financial risk (when high carbon companies that banks lend to suddenly lose a lot of their value or become less profitable), market risk (when the physical extremes of climate change send markets into disarray), reputation risk (as the public becomes more aware of climate-negligent banking practices), and a number of other risks.

As the report lays out, banks need to start assessing and managing these climate risks, offering low carbon products, and collaborating to push bolder governmental policy to accelerate the low carbon transition.

Investors in and clients of banks need to start actively engaging banks on the low carbon transition. Our report contains a detailed investor toolkit, that you can use to hold your pension fund or own bank accountable!

We launched the report at the iconic Guildhall, and were lucky to have a range of distinguished guests from private and public financial institutions.


Sir Roger Gifford, Head of SEB UK and Chair of the City of London Green Finance initiative, urged for greater individual engagement by investors, explaining that “persuasion is one of the best tools we have; financial markets are shaped by the gradual victories of many.”


Sarah Breeden , Executive Director of International Banks Supervision at the Bank of England, called the report a “valuable contribution to the debate on climate change”, warning that the financial risk from climate change was “as real” as Brexit or market fluctuation.

Edward Bonham Carter, the Vice Chairman of Jupiter Fund Management, cited Hyman Minsky’s warning – “Stability leads to instability”, cautioning that the investment system tends to develop its own illusions and blindspots in times of calm that disguise the coming volatility.

Sir Roger Gifford, Head of SEB UK and Chair of the City of London Green Finance initiative, urged for greater individual engagement by investors, explaining that “persuasion is one of the best tools we have; financial markets are shaped by the gradual victories of many.”

Francis Sullivan, the Acting Head of Global Sustainability of HSBC, concurred with Sir Gifford, lamenting that too few institutional investors actually engage banks on climate change. But ShareAction’s AGM strategy, Sullivan said, is a “formula that clearly works”.

Banks can either delay or drive forward the transition to a world below 2°C.” We’re hoping that our report, our future campaigning, and the activism of our passionate members can help drive banks to do the latter.