Ahead of its AGM this morning, HSBC has announced plans to no longer provide project finance for new tar sands activities, including pipelines, and new coal power plants globally – with the exception of Indonesia, Bangladesh and Vietnam.
ShareAction commends the progress made in this new energy policy. The UK bank has acknowledged both the negative climate impact and financial risks associated with continuing to finance climate-exposed sectors such as tar sands and coal power.
By taking steps towards aligning its business with the needs of the low-carbon transition, this new policy puts HSBC ahead of its UK peers in the management of climate risk.
However, the responsible investment charity has serious concerns about the exclusion of three South-East Asian countries from HSBC’s new policy, due to the fact that most of the bank’s coal finance is based in those three countries.
Katie Kedward, project officer at ShareAction who will be raising the issue with the bank’s board at its AGM today, says: “HSBC’s climate commitments here should not go uncelebrated, given how much they financed coal power last year. Barclays and Standard Chartered now really need to step up their game and demonstrate their ambitions in phasing out financing to fossil fuel sectors. However, we were disappointed to see the South East Asian countries excluded from HSBC’s new coal policy, which feels a little less like climate leadership, and a little more like business as usual. We’re urging them to close this loophole now.”
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Notes to editors:
• For more information, please contact Beau O’Sullivan on firstname.lastname@example.org
• Over 100,000 MW of new coal power capacity is in active development in Indonesia, Vietnam and Bangladesh.
• But it is widely acknowledged that no new coal plants can be built anywhere if we are to stay within the carbon budget required to keep temperature rises limited to 2 degrees.
• Extensive research has shown that there is a clear alternative path to renewables in Indonesia, Vietnam and Bangladesh. Yet by financing coal power sector expansion in these three countries, HSBC is facilitating the lock-in of high-carbon infrastructure and avoidable emissions; and failing to support these countries in the transition to a low-carbon economy.