Standard Chartered set new targets for reducing its funding to carbon intensive sectors by 2030. This is as a part of the goal to reach net zero emissions for itself and its clients by 2050. The Asia, Africa and Middle East-focused bank said that it would stop funding companies that are expanding in thermal coal.
The bank said that it would also reduce its financing to the power, steel and mining, oil and gas sectors. Also, expecting clients in those sectors to have their own transition strategies in line with the goals of the Paris climate agreement. The announcement from StanChart comes ahead of a gathering of world leaders in Glasgow. Which is aimed at saving the planet from the devastation wreaked by rising temperatures. StanChart, has in recent years bowed to activist and investor pressure to reduce its financing to fossil fuel-related clients.
The lender left some loopholes in its fresh commitments announced. Group-level client firms that StanChart provides financial services to will instead be subjected to enhanced due diligence. Chief Executive Bill Winters said that they are confident that they are on a science-based trajectory toward net-zero financed emissions by 2050. Lucie Pinson, executive director of Reclaim Finance, said StanChart was finally acknowledging the need to stop supporting expansion in the coal sector.
She gave a statement that having channeled $10 bln to the coal sector between October 2018 and October 2020, the bank has given itself enough wriggle room to protect its interests in giant coal companies like Glencore. They are now developing new coal mines in Australia and South Africa. After the International Energy Agency (IEA) said that the world needed no new fossil fuel projects if it wanted to hit its climate goals by mid-century, StanChart said oil and gas companies would need a Paris-aligned strategy by 2022. Pinson, said that it was unclear. If Standard Chartered is genuinely intent on requiring Paris-aligned strategies, then it should clarify that this means a clear stop to new oil and gas fields .