Global banking and financial services company HSBC announced today a series of key steps it will take to advance its net zero-aligned financing goals, including a commitment to phase down fossil fuel financing, and to review clients’ transition plans to assess whether to provide financing services.

The new steps build on the bank’s recent climate-related finance announcements, including the introduction last month of financed emissions reduction targets for the carbon intensive Oil & Gas and Power & Utilities sectors, and its commitment from December to phase out financing of coal-fired power and thermal coal mining. HSCB said that the new commitments are supported by responsible investing NGO ShareAction, who led a campaign last year to drive a deeper commitment to climate action from the bank.

One of the key steps announced by HSBC is a commitment to publish a bank-wide climate transition plan next year, outlining how the bank will implement its net zero ambition, including the integration of its climate strategy, science-based emissions reduction targets into its wider strategy, processes, policies and governance.

HSBC also introduced several energy finance commitments, including plans to phase down fossil fuel financing to levels aligned with limiting the global temperature rise to 1.5°C, and to support energy sector clients that take an active role in the energy transition and apply good industry practices around ESG issues. In order to facilitate its goal to finance the transition, HSBC will require clients to provide transition plans. If the plans are not provided or are not compatible with the bank’s net zero target, HSBC said that it will formally assess whether to continue to provide financing for that client.

Additionally, HSBC committed to reviewing and updating its wider financing and investment policies this year, assessing how the policies can be updated to best reflect emerging science, international guidance, and good industry practice to achieve net zero by 2050.

HSBC Group Chief Sustainability Officer, Dr Celine Herweijer, said:

“We believe we can have the biggest impact on climate action by actively engaging our clients on their transition, focusing on the need for robust and credible transition plans, and by providing the financing and advisory solutions that help unlock the investments needed. We know we need to transform the bank to achieve this, and we want to demonstrate the actions we are taking to make this happen.”