Barclays plans to step up its financing of renewable energy as Russia’s war on Ukraine adds to the urgency of moving away from fossil fuels.
“The appalling invasion of Ukraine has made it even more imperative to accelerate the energy transition,” Barclays Chairman Nigel Higgins said on Tuesday.
Barclays expects that recent events will boost “demand for investment in low-carbon energy infrastructure.” The bank said in a climate-strategy report that it’s “determined to finance, on an even greater scale, the investment needed for transition.”
The onset of war in Europe and its fallout on energy markets threatens to complicate the race against global warming. Higgins said climate pledges may now be harder to keep. And he predicted a “volatile and non-linear” path toward cutting financed emissions, citing factors “beyond our control.”
Since the Paris climate accord was struck in 2015, Barclays has underwritten over $58 billion of fossil-fuel bonds, more than any of its European peers, according to data compiled by Bloomberg. In the same period, it helped arrange more than $40 billion in green bonds, ranking it fifth in Europe.
Barclays said it’s targeting a 30% reduction in the CO2 intensity of its power portfolio by 2025. The company also intends to cut the absolute emissions of its energy portfolio by 15% in the same period.
The British bank plans to cut the carbon footprint of lending and underwriting across the highest-emitting sectors in its portfolio, and added cement and steel targets to existing energy and power goals. The bank’s executive directors will also see their pay affected, as Barclays promises to align remuneration with the achievement of its climate goals.
According to ShareAction, a London-based nonprofit, Barclays’ climate goals aren’t ambitious enough. It’s therefore urging investors to vote against the bank’s climate proposals.
“By failing to update its oil and gas policy it can continue to finance Paris misaligned activities such as oil sands and new oil and gas,” Lydia Marsden, senior research officer at ShareAction, said in a statement.
“Investors need to question whether Barclays’ policies and targets truly mark progress or instead enable business as usual for its clients,” she said.
Other U.K. banks are also trying to burnish their climate credentials against the backdrops of accelerating global warming and a war-fueled energy crisis. On Wednesday, NatWest Group said it plans to put climate resolutions to shareholders at this year’s annual general meeting, marking a first for the lender.
“Tackling climate change is a key strategic priority for NatWest Group,” Chief Executive Alison Rose said in a statement. “It is also near the top of the agenda for many of our shareholders, and we want to work with all of our stakeholders help to shape our future planning, execution and reporting on climate.”
Earlier this month, HSBC Holdings promised to “
