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Press release: 6 April 2020
Following three months of investor discussions, Barclays filed a special resolution on Friday setting an ambition to be a net zero bank by 2050. The bank recommends its shareholders vote in favour of this resolution, which also contains commitments to align its financing activities with the Paris Agreement.
The announcement follows an earlier resolution brought by a group of ShareAction-led investors in January of this year, following which ClientEarth CEO James Thornton wrote to Barclays’ Board reminding board members of their legal duties to address climate change risks.
ClientEarth lawyer Daniel Wiseman said: “With this resolution, Barclays has taken positive action on climate. The resolutions now before shareholders present an historic opportunity to transform Barclays from an industry laggard to a global leader on climate. They show why it is so critical that investors flex their stewardship muscles and demand action.
“Currently, Barclays is still lagging behind its European peers on climate action and increased its financing for oil, gas and coal companies just last year. The resolution proposed by Barclays is a good signal of intent – but it will be meaningless if not backed up by a strong and credible strategy to align all its activities with the Paris Agreement goals.
“Barclays’ move sends a clear signal to other financial heavyweights: continuing to finance activities that exacerbate climate change is unsustainable and compounds the risks climate change presents to business and society at large. Banks, pension funds and all other financial services companies should take note of these risks, as well as the legal risks which may ensue if they do not align with emerging industry standards.”
In a legal letter sent to each of Barclays’ Board members in late February, ClientEarth CEO James Thornton reminded board members of their legal obligations to address climate change risks.
The move came after a landmark climate resolution was filed in January by 11 institutional investors, 130 individual investors and co-ordinated by ShareAction, calling for phase-out of financing activities to the most carbon-intensive energy companies.
Barclays responded by putting forward its own climate resolution, in which it pledged to align all of its financing activities with the goals and timelines of the Paris agreement, starting with the energy and power sectors, and to publish “transparent targets” to track its progress.
Climate change poses risks to individual businesses and a systemic risk to the economy. Physical assets and operations are already being hit by extreme weather, and this is set to worsen. Banks have a vital role to play in the transition away from fossil fuels. Barclays has invested £100 billion into fossil fuel companies. That makes it the largest financer of fossil fuels in Europe, ranking seventh in the world.
Public pressure is mounting. Our recent survey shows that more than six in ten people (62%) did not know that their bank could be investing their money in fossil fuels, and 67% of young people think financial institutions and banks should be legally accountable if they don’t ditch fossil fuels.
Investors will vote on the resolution at Barclays’ Annual General Meeting on 7 May 2020.
ClientEarth has previously helped to coordinate climate change resolutions requiring BP and Shell to assess and manage the risk of climate change.
ClientEarth is a charity that uses the power of the law to protect people and the planet. We are international lawyers finding practical solutions for the world’s biggest environmental challenges. We are fighting climate change, protecting oceans and wildlife, making forest governance stronger, greening energy, making business more responsible and pushing for government transparency. We believe the law is a tool for positive change. From our offices in London, Brussels, Warsaw, Berlin and Beijing, we work on laws throughout their lifetime, from the earliest stages to implementation. And when those laws are broken, we go to court to enforce them.