Barclays has announced that it plans to reduce its carbon footprint to net zero by the year 2050.
The announcement comes after increased pressure in recent months from investors concerned about the bank’s financing of carbon-intensive companies.
The London-based bank has pledged that its activities moving forward will all be in alignment with the goals of the Paris climate accord. It plans to publish ‘transparent targets’ in order to track its progress, and will kick-off the changes in its power and energy divisions.
The new plans have developed in response to a shareholder resolution which urged the bank to stop lending money to companies that fail to align their activities with the Paris climate agreement.
The proposal will be voted on by investors at the bank's annual general meeting this coming May.
Barclays’ commitment to becoming net zero by 2050 has been lauded as a ‘milestone announcement’ by ShareAction - the campaigners that led the shareholder vote.
However, the campaign group is still urging investors to back both resolutions so that the bank will be held accountable to its pledge to stop funding projects run by the largest carbon emitters, instead of merely offsetting their investments by investing in other sectors.
A recent report from the Rainforest Action Network showed that Barclays has been the seventh largest financier of fossil fuels in the world over the last seven years, and the largest financier within Europe.
Barclays was also the largest financier of Arctic gas and oil in 2019, and has provided funding to the tune of £95.2bn to carbon-intensive companies since 2016.
The asset manager Sarasin & Partners was a co-filer of the resolution put forward by ShareAction. The head of stewardship at Sarasin & Partners, Natasha Landell-Mills, said: “The message is powerful: continuing to finance activities that undermine planet stability is not in anyone’s interests – and certainly not shareholders. This is groundbreaking and the board deserves to be commended. Other banks should follow suit.
“What matters now is that the board sets robust nearer-term targets that leave no doubt about its determination to deliver net zero emissions by 2050. Shareholders should underline their support for this by supporting not just Barclays’ resolution but also the shareholder-initiated resolution at Barclays’ forthcoming AGM”.
Barclays will consult with groups such as ShareAction before releasing its specific targets by the end of 2020, and will make its first announcement on its progress next year.
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