In a pivotal moment for the UK’s financial landscape, the nation’s largest banks, including HSBC, Barclays, NatWest, and Lloyds, are set to unveil their annual reports this month. As they prepare for scrutiny, a growing campaign led by ShareAction, a responsible investment advocacy group, is urging institutional shareholders to hold bank chairs accountable for any withdrawal from climate commitments.
Campaign Group Targets Bank Leadership
With the release of annual reports imminent, ShareAction is gearing up to issue critical assessments of 34 major global lenders’ adherence to their climate strategies. The reports will meticulously evaluate any adjustments in banks’ environmental policies, typically disclosed alongside their financial statements. This scrutiny is especially pertinent for UK banks, which are due to publish their annual reports by the end of February, with Barclays scheduled to release its findings on Tuesday.
ShareAction has called on institutional investors to consider voting against the re-election of any chair perceived as undermining climate initiatives. These votes are set to occur during annual shareholder meetings commencing this spring, marking a significant moment for both the banks and their stakeholders.
A Symbolic Stand Against Climate Backtracking
Kelly Shields, ShareAction’s senior campaign manager for the banking programme, emphasised that while the likelihood of removing a bank chair is low, sending a strong message is crucial. “This is about making it personal,” she stated. Even a minor reduction in the overwhelming support that some directors typically receive—often around 98-99%—can signal discontent and encourage them to engage more earnestly with climate issues.
Shields aims to curb the trend of environmental regression within the banking sector, particularly as financial institutions face intensified scrutiny over their green pledges in the aftermath of Donald Trump’s return to the White House. His administration’s anti-green policies have emboldened climate sceptics and ignited a renewed push for fossil fuel investment, placing pressure on banks to increase financing for oil and gas sectors.
The Implications of Climate Policy Withdrawal
The withdrawal of high-profile banks from the UN-backed Net Zero Banking Alliance (NZBA), which was designed to uphold commitments to achieving net zero emissions by 2050 or sooner, has raised alarm bells. Notable exits include JP Morgan, Citigroup, Goldman Sachs, as well as Barclays and HSBC. The NZBA’s disbandment in September 2023 highlighted the shifting priorities within the banking sector.
HSBC has notably announced delays in key climate objectives, pushing back parts of its climate goals by two decades. This decision came alongside the introduction of a new long-term bonus plan for its CEO, Georges Elhedery, which has raised questions about the bank’s commitment to sustainability.
Shields articulated the urgency of the situation: “We want banks to reassess their approaches and prioritise long-term financial stability while considering the needs of people and the planet.”
Why it Matters
As the world grapples with the escalating climate crisis, the actions of these banks will serve as a litmus test for corporate accountability in environmental matters. Shareholder revolts could mark a turning point in how financial institutions align their operations with climate commitments. The outcome of these meetings may not only influence the future direction of the banks involved but also set a precedent for the global financial community, illustrating that accountability in climate action is paramount for sustainable economic growth.
