Green finance groups slam HSBC's carbon exit plan

LONDON (AFP) – British banking giant HSBC on Tuesday (Dec 14) published a plan to stop financing thermal coal activities but drew immediate criticism from environmentalists for not going far enough.

HSBC said in October last year that it wanted to achieve a net-zero financing portfolio by 2050, in line with the 2015 Paris Agreement on limiting global warming to 1.5 Celsius.

Under the plans, it said it will “not provide new finance to any client for the specific purpose of activities that HSBC considers incompatible” with that target.

The plan commits to phasing out financing of thermal coal mining or coal-fired power generation in the EU and OECD by 2030 and the rest of the world by 2040.

It also aims to publish a science-based emissions target next year, and has set a target of reducing its exposure to thermal coal financing by at least 25 percent by 2025.

Campaign group Reclaim Finance, which lobbies for a greener financial sector, said the plan by HSBC “does not put a hard stop to its financing of the coal sector”.

It said the bank provided US$4.1 billion (S$5.6 billion) to companies planning new coal plants and US$15 billion to the entire coal industry, including in energy-hungry Asia.

“Financial institutions who are serious in their net-zero commitments should instead blacklist all coal developers, without exception,” it added.

ShareAction, a non-governmental organisation campaigning for responsible and sustainable finance, welcomed HSBC’s progress in cutting coal-related corporate finance and the extension to asset management.

But it said there were “disappointing loopholes… which allow for the continued financing of top coal companies and developers whose activities would take us past the 1.5C threshold”.

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