Barclays Pledges Net Zero Emissions by 2050 -- Update
March 30 2020 - 11:03AM
Dow Jones News
By Maitane Sardon
Barclays PLC said Monday that it will aim to be a net-zero bank
by 2050 by aligning the emissions of the activities it finances
across all sectors with the Paris Agreement on climate change.
The British bank, which has come under fire from investors for
having a weaker climate policy than some of its European rivals,
said it will start with the energy and power sectors and provide
targets to measure its progress in 2021.
Barclays is the largest fossil-fuel financier in Europe and the
sixth globally, having provided more than $118 billion to
fossil-fuel companies and high-carbon projects such as tar sands
and Arctic oil and gas since the Paris agreement was signed in
2016, according to a report by Rainforest Action Network, an
environmental organization.
Some of the measures the bank will implement will lead to a
reduction in the carbon-dioxide intensity of its power and energy
portfolios of 30% and 15% respectively by 2025, Barclays Chairman
Nigel Higgins said in a letter to shareholders included in the
bank's annual ESG report.
Mr. Higgins said Barclays will seek to prioritize its lending to
companies aligned with the Paris agreement, reduce its exposure to
the most carbon-intensive forms of energy production and re-weight
its financing to reflect the proportions of energy required
globally from different sources to meet the Paris targets.
"It is true that the bank... has not addressed the climate
challenge as fully and as early as we now all wish had been the
case," Mr. Higgins said. "This is particularly true of our
financing for thermal coal, where our historic exposures are higher
than we would like, and where we are now introducing new
restrictions"
He said Barclays will steadily reduce its thermal-coal financing
and only provide finance to firms whose thermal-coal activities
represent less than 30% of revenue by 2025 and less than 10% of
revenue by 2030.
Investors in the British bank welcomed the announcement but
noted the bank has urgent work to do to curb its fossil-fuel
financing in the short term. They encouraged other shareholders to
back a resolution filed by campaign group ShareAction and supported
by investors representing around $2 trillion in assets, including
money managers Jupiter Asset Management Ltd., Sarasin &
Partners and Amundi, and Nest, the largest U.K. pension fund by
members.
The resolution calls for the phasing out of financing activities
to the most carbon-intensive energy companies. It will be voted on
at Barclays's annual general meeting on May 7, but faces opposition
from the bank's board of directors.
"What matters now is that the board sets robust nearer-term
targets that leave no doubt about its determination to deliver
net-zero emissions by 2050," said Natasha Landell-Mills, head of
stewardship at Sarasin & Partners.
Barclay's announcement is the latest environmental pledge by a
European bank. Earlier this month, Swiss bank UBS Group AG said it
would no longer finance new offshore-oil projects in the Arctic,
thermal-coal mines or oil sands on undeveloped land. In February,
Royal Bank of Scotland Group PLC said it would end financing for
coal by 2030 and place stricter rules on oil-and-gas majors it
works with.
Write to Maitane Sardon at maitane.sardon@wsj.com
(END) Dow Jones Newswires
March 30, 2020 10:48 ET (14:48 GMT)
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