-
All 4 main banks highlighted within the research have agreed to succeed in their internet zero objectives by 2050.
-
An exception is NatWest, which, not like its friends, invested more cash in inexperienced companies than in fossil fuels.
-
Reportedly, Barclays and HSBC lobbied the UK authorities towards local weather insurance policies.
The UK’s largest banks are largely financing fossil gasoline firms regardless of making public internet zero commitments for 2050, a brand new report printed by local weather assume tank InfluenceMap notes.
The report comes on the heels of one other research printed earlier in Could 2025, which linked UK banks to £75bn in fossil gasoline tasks overseas.
READ MORE: UK Banks Linked to £75bn in Fossil Gas Tasks Overseas
In line with InfluenceMap, the highest banks within the nation—Barclays, HSBC, Lloyds, and NatWest—invested £119 billion in fossil gasoline companies, together with oil and gasoline, between 2020 and 2024. This determine is about double the funding in inexperienced ventures throughout the identical interval.
The imbalance is way wider at Lloyds, HSBC, and Barclays. When contemplating these banks individually, Lloyds ploughed 3.1 instances extra funding into fossil fuels than inexperienced actions, adopted by HSBC and Barclays with 2.9 instances and 1.8 instances, respectively.
Bonnie Steinberg, senior analyst at InfluenceMap, stated: “The banks’ continued financing of expansionary oil and gasoline firms, and Barclays’ and HSBC’s pushback towards sound climate-related monetary coverage, solely worsen the long-term dangers these banks face.”
Within the meantime, NatWest, in distinction to its counterparts, invested more cash into inexperienced companies than in fossil fuels. Nonetheless, all these well-known UK monetary establishments proceed to help and broaden fossil gasoline operations.
ALSO READ: Analysis: European ESG Funds Invested Over €123B in Fossil Fuels
The report discovered that the banks throw their weight behind polluting companies by means of their insurance policies and lobbying practices. Whereas there are some restrictions on direct investments in new fossil gasoline growth, these insurance policies have loopholes that permit them to help huge polluters with impunity.
This implies cash can nonetheless circulate swimmingly to high-emitting industries not directly or by means of different financing mechanisms.
By the way, Barclays and HSBC reportedly lobbied the UK authorities towards stringent laws on sustainable finance, decidedly elevating questions on greenwashing, which is rampant in at this time’s environmental, social, and governance (ESG) market, because of the absence of rigorous legal guidelines.
The research additionally highlights the incremental danger of carbon lock-in and stranded property, which means if the banks proceed to finance the fossil gasoline business, it should lock in excessive emissions for many years and make it unimaginable to transition to scrub power. This will create a boomerang impact for the banks, as fossil gasoline property would possibly lose worth if international local weather insurance policies set up a stranglehold sooner or later.
“To match the ambition of their top-line targets, the banks’ exclusion insurance policies ought to recognise fossil gasoline growth as a stranded asset whereas focusing their transition efforts away from carbon lock-in and in direction of science-based definitions of inexperienced applied sciences,” concludes Steinberg.
Ends/
Are you searching for sustainability consultants to information your corporation? Discover our ESG Market, that includes over 700 suppliers providing a large alternative of sustainable advisory providers.
Observe our Investor Information for normal information and views.
Try our newest ESG Course updates
Supply: InfluenceMap
