HSBC Holdings plc (NYSE:HSBC) has announced a withdrawal from the coal fired power sector, as part of its efforts to support a transition to a low-carbon economy.
In 2011, HSBC decided to significantly restrict its support for new coal-fired power plants and effectively ceased financing them in 78 developed countries. It will now stop financing new coal-fired power in all countries around the world apart from Bangladesh, Indonesia and Vietnam. A targeted and time-limited exception will apply to these three countries in order to appropriately balance local humanitarian needs with the need to transition to a low-carbon economy.
Daniel Klier, Group Head of Strategy and Global Head of Sustainable Finance, HSBC said:
Our updated energy policy reflects HSBC’s ambition to help our customers make the transition to a low-carbon economy in a responsible and sustainable way. We recognise the need to reduce emissions rapidly to achieve the target set in the 2015 Paris Agreement to limit global temperatures rises to well below 2°C and our responsibility to support the communities in which we operate.
In addition to this policy change, HSBC has also pledged not to provide financial services for:
- New offshore oil and gas projects in the Arctic
- New greenfield oil sands projects
- New large dams for hydro-electric projects inconsistent with the World Commission on Dams Framework
- New nuclear projects inconsistent with the International Atomic Energy Agency (IAEA) standards