(Bloomberg) — HSBC Holdings Plc pushed back its deadline to meet a number of key climate targets by two decades and is reviewing other objectives, as Europe’s biggest bank says its efforts to cut emissions are being hampered by the slow pace of decarbonization in the wider economy.
“We are now focused on achieving net zero in our operations, travel and supply chain by 2050,” HSBC said on Wednesday in a report alongside its fourth-quarter earnings. “Progress in reducing emissions in the Scope 3 supply chain component is proving slower than we anticipated.”
It’s the latest retreat from climate goals that a number of financial behemoths say are becoming increasingly unrealistic to meet. They warn that cutting financed emissions in line with a scenario in which the average global temperature rise is limited to 1.5C above pre-industrial levels isn’t feasible in a world that’s on track for roughly twice that level of warming.
HSBC now expects to cut Scope 1 and Scope 2 emissions — pollution produced directly, or through the generation of power consumed — by more than 90% from a 2019 baseline by the end of the decade. It forecasts a smaller reduction in Scope 3, emissions tied to suppliers and customers. The bank expects to curb pollution across “operations, business travel and supply chain” by 40% by 2030, it said in the report.
HSBC follows businesses from Walmart Inc. to Air New Zealand Ltd. in delaying or abandoning deadlines for climate targets, with companies citing a lack of available decarbonization technologies, uneven access to renewable energy and differences in policies between countries.
Factors outside the bank’s control that are impacting its ability to meet targets include the speed of “technological advancements, diversification of the energy mix, market demand for climate solutions, evolving customer preferences, and government leadership and effective policy,” HSBC said.
The bank is now reviewing its 2030 targets for financed emissions in seven sectors, and will update investors in the second half of this year on its transition plan, the report said. HSBC has begun conducting emissions reduction assessments for major clients in the automotive, aviation and cement sectors, among others, as it aims to grow its transition finance business.
Since the beginning of 2020, HSBC has allocated more than $390 billion in sustainable finance and investment after doing almost $100 billion in green and social financing in 2024, according to its annual report. That compares with a goal of between $750 billion and $1 trillion by 2030.
–With assistance from Andrew Janes.
(Updates with sustainable finance and investing allocations in final paragraph.)
More stories like this are available on bloomberg.com
Leave a Reply