Europe’s largest bank, HSBC, announced Friday it would no longer back coal power plants in most countries or finance oil sands projects in Canada and offshore drilling in the Arctic, Financial Times reported.
The policy mirrors those of several other large banks such as ING, BNP Paribas and BBVA, reflecting a growing push by environmentalists for financial institutions to change their lending practices to address climate change.
“We recognize the need to reduce emissions rapidly to achieve the target set in the 2015 Paris Agreement to limit global temperature rises to well below 2 degrees Celsius and our responsibility to support the communities in which we operate,” HSCB global head of strategy and sustainable finance Daniel Klier said, according to Axios.
The British bank is exempting power plants in Indonesia, Bangladesh and Vietnam from its policy so as not to cut the developing countries off from power when no realistic alternative is available.
“It is not a commercial decision,” Klier said, according to Financial Times. “We are trying to balance two different sustainable development goals of getting power to the people and limiting the environmental impact.”
“There’s a very significant number of people in those three countries who have no access to any electricity,” HSBC CEO John Flint told shareholders, Reuters reported. “The reasonable position for us is to allow a short window for us to continue to get involved in financing coal there.”
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