Climate Investment Newsletter 10/5 - 10/11

Macro Commitments

HSBC targets net zero emissions by 2050, earmarks $1 trillion green financing

• HSBC will target net zero carbon emissions across its entire customer base by 2050 at the latest, and provide between $750 billion and $1 trillion in financing to help clients make the transition, Chief Executive Noel Quinn told Reuters.

BTPS commits to net-zero portfolio by 2035

• BT Pension Scheme, London, has pledged to achieve net-zero greenhouse gas emissions in its £55 billion ($67.8 billion) portfolio by 2035.

Australia announces $1.62 billion in funding for renewables agency

• In Australia, the government has announced up to $1.62 billion in funding to support the development and adoption of innovative low-carbon energy technologies over the next ten years.

Danica Pension launches sustainability-focused investment option

• Danica Pension, Copenhagen, launched a new investment option for plan participants in an effort to grow the size of its sustainable allocations to 100 billion Danish kroner ($15.7 billion) by 2030.

JPMorgan Chase Adopts Financing Commitment Aligned with the Paris Agreement

• As part of its commitment, JPMorgan Chase will establish intermediate emission targets for 2030 for its financing portfolio and begin communicating about its efforts in 2021. The firm will focus on the oil and gas, electric power, and automotive manufacturing sectors and set targets on a sector-by-sector basis.

Frameworks and Case Studies

The Science Based Targets Initiative Launches First Framework for Financial Institutions

• Nearly 1,000 companies in 50 sectors from coal and gas to pharmaceuticals, with a cumulative market cap of $15.4 trillion, have pledged to align their decarbonization plans with the Paris Agreement by adopting science-based greenhouse gas reduction targets (SBTs). But no such target framework was available for banks or other financial institutions — until now.

Japanese academics publish ‘transition taxonomy’ for financing greener businesses

• Japanese researchers have published their final Transition Finance Guidance, which includes two “transition taxonomies” – standards for financing corporates and individual business activities to support the transition to a low-carbon economy.

Individual Deals and Market Watch

Record Month Shoots Green Bonds Past Trillion-Dollar Mark

• Green bonds have passed their biggest milestone yet, with more than $1 trillion issued since these securities first emerged in 2007, according to research company BloombergNEF (BNEF). They are the longest standing and most heavily used instrument in the sustainable debt market, which covers a range of fixed-income products offering environmental and social benefits.

Clean energy group NextEra surpasses ExxonMobil in market cap

• The world’s largest solar and wind power generator has surpassed ExxonMobil in stock market value, reflecting investors’ bets on a changing energy system and an uncertain outlook for oil demand.

Church of England Unloads Exxon Shares on Failed Emission Goals

• The Church of England Pensions Board has sold all its holdings of Exxon Mobil Corp. because the oil giant failed to set goals to reduce emissions produced by its customers.