Barclays Bank is working toward being carbon neutral across the activities it finances by 2050 to be in line with the Paris Agreement.
The bank’s pledge, deemed still as an ambition and not a full-on commitment, joins a recent trend of industry participants who have pledged to do the same, including the San Francisco Employees’ Retirement System, the Netherlands’ ABP $515 billion pension fund, and a collective of institutional investors overseeing $2.4 trillion in assets under management called the Net-Zero Asset Owner Alliance.
“The alignment of Barclays’ portfolio will start with the energy and power sectors, and will cover all sectors over time,” the bank said in a statement. “Barclays will provide the transparent targets required to judge its progress and will report on them regularly, starting from 2021.”
The decision is up to further approval from its shareholders, particularly from those associated with the group called ShareAction, an organization that wants to “make ordinary savers and institutional investors work together to ensure our communities and environment are safe and sustainable for all,” the group wrote on its website.
In a January proposal, ShareAction wrote to Barclays to encourage it to adopt a carbon net-neutral resolution.
“To promote the long-term success of the company, given the risks and opportunities associated with climate change, we as shareholders direct the company to set and disclose targets to phase out the provision of financial services … to the energy sector, and electric and gas utility companies that are not aligned with … the Paris Agreement,” ShareAction said in its letter to Barclays.
The group promoted research concluding that a 2 degree Celsius rise in global temperatures will pose a serious economic risk to companies whose revenue streams are highly associated with the fossil fuel industry.
“As a systemically important global bank, the financing and underwriting activities of Barclays will influence whether or not the Paris goals are met,” ShareAction added.
The institutional investor group said its members will work with the companies it engages with to reduce their carbon footprint as a result of their business operations. Barclays’ statement did not reveal similar details.