HSBC gears closer to net-zero carbon emission goal

It began with a vision to support the global crusade on climate change. Anchored on principles that align with the Paris Agreement, HSBC, one of the world’s largest banks, is playing a leading role in mobilizing the transition to a global net zero economy when it was named the World’s Best Bank for Sustainable Finance back in 2019. In the latest Navigator report, polled from more than 10,000 companies across 39 markets around the world, this indicates that “86 percent of companies expect their revenue to grow in the next year from a greater focus on sustainability.”

HSBC has been an active bank in the Philippines for more than 146 years and has been active in its efforts to support the community, particularly during the pandemic.

It was named as International Bank of the Year in the Philippines by Asian Banking and Finance Awards in 2021, where it continued to be of service to its customers and the wider community, providing digital innovations that enabled remote account opening and online payments for better customer experience, financial relief for its customers, and credit card promotions with a cause.

As HSBC moves forward to become operationally net-zero by 2030, it adds a layer to its campaign “Together Let’s Help Rebuild the Nation,” early on in the pandemic, by helping build a thriving future for the planet.

With its lending portfolio becoming more and more geared toward sustainable projects and helping clients with their net-zero transition journey, the bank moves closer to its net-zero carbon-emission target all the while creating a world of sustainable opportunities for the market.

Transition to net zero

Net zero, put simply, is achieving a balance between the amount of greenhouse gas emissions produced and the amount removed from the atmosphere. For HSBC, this means becoming net zero in its operations and supply chain by 2030, and more importantly, its financial portfolio by 2050.

As part of HSBC’s ambition to support its customers in their transition to net zero and a sustainable future, the bank aims to provide and facilitate $750bn to $1tn of sustainable finance and investments by 2030.

“Sustainable finance is key to our long-term strategy. We are at the start of a journey and are committed to being the leading bank in financing the transition to a sustainable, low-carbon economy,” said Mimi Concha, Head of Wholesale Banking, HSBC Philippines.

“We will continue to support our customers’ investments and growth in this area, and my team and I are keen to have conversations with our clients on how we can partner to help our community become more sustainable,”

By increasing its portfolio of transition finance solutions, the bank could help the most “heavy-emitting sectors to progressively decarbonize,” contributing towards a just and stable transition to maintain economic stability.

Global asset class will include sustainable infrastructures. This will become the purveyor of bankable projects, leading the Finance to Accelerate the Sustainable Transition-Infrastructure initiative “to drive investment in sustainable infrastructure together with the OECD (Organization for Economic Co-operation and Development) and the World Bank Group.

Next generation climate solutions

However, achieving net-zero in operations by 2030 and in financed emissions by 2050 may seem like a Herculean task, requiring developing clear and measurable pathways to net zero. Aside from the bank becoming net-zero and supporting customers to flourish through their transitions, this also includes leading the way to enable industries to unlock next-generation climate solutions. HSBC stepped up its global efforts by investing US $100 million through its Climate Solutions Partnership, with a network of local partners, that aims to scale up climate innovation ventures, nature-based solutions and help to transition the energy sector towards renewables in Asia, by combining their resources, knowledge and insight.

Another avenue where HSBC hopes to develop next-generation climate solutions will be made possible through its joint venture called HSBC Pollination Climate Asset Management. The joint venture aims to be the world’s largest natural capital managers, putting in the mainstream natural capital as an asset and investing in long-term activities that “preserve, protect, and enhance” nature.

Globally, HSBC will also create a dedicated unit that will tailor propositions to support CleanTech innovation companies, with a target of US$100 million of investment.

Additionally, a US$100-million donation through its philanthropic arm also hopes to scale climate innovation ventures, renewable energy, and nature-based solutions until 2025.

Transparency

Part of this journey is transparency and thought leadership. Stakeholders can track their journey to net zero using the science-based Paris Agreement Capital Transition Assessment Tool to develop clear and measurable ways to achieve net zero.

It commits to making regular disclosures to communicate its progress in line with the Taskforce on Climate-Related Financial Disclosure Guidelines and encouraging its customers to do the same. The bank will also work with peers, central banks, and industry bodies to create a system of a “globally consistent, future-proofed standard to measure financed emissions and a functioning carbon offset market.”

“HSBC has long been committed to opening up opportunities for our customers and the communities we serve. As we enter a pivotal decade of change, we have a landmark opportunity to accelerate our efforts to build a healthier, more resilient, and more sustainable future,” said Graham FitzGerald, President and CEO, HSBC Philippines.

“Our net-zero ambition represents a material step-up in our pledge to be a leader in sustainable finance and help our clients transition with us,” added FitzGerald.

The global bank believes that a world of growth and opportunity has sustainability in its foundation. HSBC continuously works with governments, NGOs, investors, suppliers, and other financial institutions to support long-term investments in environmentally sustainable endeavors, create sustainable finance solutions and usher a journey to net-zero transition with and for its clients.

To know more about HSBC’s Sustainable Finance, visit https://www.hsbc.com/who-we-are/our-climate-strategy/providing-sustainable-finance