Standard Chartered (the group) announced ambitious new targets to reach net-zero carbon emissions from its financed activity by 2050, including interim 2030 targets for the most carbon-intensive sectors on Monday.
The Group’s approach is based on the best data currently available and aligns to the International Energy Agency’s Net Zero Emissions by 2050 scenario (NZE), said a press release.
Whilst 33 of our 59 footprint markets do not at present have a commitment to reach net zero by 2050, we are setting out our plan for this timeline, recognising the pivotal role we can play in the transition. Many of these markets are currently reliant on carbon-intensive industries for their continued economic growth.
Achieving a just transition – one where climate objectives are met without depriving developing countries of their opportunity to grow and prosper – will require capital and specialised support.
Standard Chartered’s net-zero approach has three aims: Reduce the emissions associated with our financing activities to net zero by 2050, setting 2030 interim targets in our most carbon-intensive sectors Our current estimate of in-scope baseline emissions from our corporate client base as at year-end 2020 is 45.2 million metric tonnes of carbon dioxide equivalents, associated with USD74.8 billion of assets (or 77% of our total drawn on-balance-sheet financing exposure of USD97.3 billion to corporate clients).
The group aim to reduce absolute financed thermal coal-mining emissions by 85% by 2030, in addition to the existing prohibition on financing new or expanding coal-fired power plants. By 2030 we will only provide financial services to clients who are less than 5% dependent on revenue from thermal coal. As we expand our green and transition finance, we are targeting 2030 reductions in revenuebased carbon-intensity (i.e. the quantity of greenhouse gas emitted by our clients per USD of their revenue) of 63% for power, 33% respectively for steel and mining (excluding thermal coal mining) and 30% for oil and gas Public.
While the NZE foresees a decline in fossil-fuel production, progress won’t be linear and production of some fossil fuels may rise before it comes down in our markets, e.g. gas as it replaces more carbon-intensive alternatives such as coal in the transition phase.
As standards and methodologies evolve, and data quality and availability improve, we will refine our emissions calculations further. To ensure transparency, we report yearly on progress, in detail, as part of the Task Force on Climate-Related Financial Disclosures process. Catalyse finance and partnerships to scale impact, capital and climate solutions to where they are needed most, including a plan to mobilise USD300 billion in green and transition finance Our new Transition Finance Framework sets out how our transition finance will be governed by alignment to the NZE and a set of well-defined principles that help guide our clients onto a lowcarbon pathway.
In wealth management, by 2025 we aim to double sustainable investing assets under management and integrate environmental, social and governance considerations into our advisory activities. José Viñals, Group Chairman said,”Following engagement with clients, shareholders and NGOs, we are setting out our methodology for how we intend to reach net zero by 2050.’’
We are motivated by a belief that we can and must address the need for decarbonisation as a result of greater climate-related risks, which increase financing costs and hamper emerging markets’ long-term economic prospects.” Bill Winters, Group Chief Executive, added: “We’re confident that we’re on a science-based trajectory toward net-zero financed emissions by 2050 that is consistent with the Paris Agreement.
