RBS Pledges End to Coal Funding, Stricter Oil Rules -- Update
By Dieter Holger
Royal Bank of Scotland Group PLC said it would end financing for
coal by 2030 and place stricter rules on oil-and-gas majors it
works with, joining other companies that have made similar
sustainability moves as investors and the public demand action on
"Today marks a new era," said Alison Rose, chief executive of
RBS, who took the helm in November.
RBS said it would end coal financing by 2030 and stop lending
and underwriting companies with more than 15% of their activities
related to coal by the end of 2021, unless they have a transition
plan in line with the Paris Agreement. It also pledged to halt
lending to and underwriting major oil-and-gas producers without a
transition plan by 2021.
The bank, which is set to rebrand as Natwest Group PLC later
this year, said it would halve the climate impact of all financing
by 2030 and double funding for climate and sustainable finance to
GBP20 billion ($26 billion) by 2022.
The announcement by RBS is the latest environmental pledge from
a multinational company. BP PLC on Wednesday pledged to reduce its
net carbon emissions to zero by 2050. Microsoft Corp., meanwhile,
said last month it would attempt to become "carbon negative" by
2030, meaning it would seek to take more carbon out of the air than
its operations and those of its supply chain produce.
British banks are under pressure from environmentalists and
investors to move their financing away from fossil fuels.
RBS competitor Barclays PLC has been fending off criticism for
its financing of coal, fracking and tar sand projects and faces a
shareholder resolution at its annual meeting in May -- filed by
U.K. investor advocacy group ShareAction with the support of
investors representing some GBP130 billion in assets -- to phase
out services to energy companies that aren't aligned with the Paris
A Barclays spokeswoman didn't immediately provide a comment
Friday. Barclays spokesman Simon Hailes last month said the bank
was "working to help tackle climate change, and we meet with
ShareAction and other shareholders regularly to update them on our
RBS's move also comes as the British government and the European
Union aim to reach carbon neutrality by 2050 and is set to host the
next global climate change conference, COP26, in Glasgow this year.
The European Commission has estimated that, including the U.K.,
which recently left the EU, it could cost up to EUR575 billion
($624.4 billion) a year for the bloc's member states to hit the
climate ambition, or around $18.7 trillion over the next 30
"This will be a significant challenge as we, like others, do not
yet fully understand what this will require and how it will be
achieved, not least as there is currently no standard industry
methodology or approach, " Ms. Rose said.
Kristin Broughton contributed to this article.
Write to Dieter Holger at email@example.com
(END) Dow Jones Newswires
February 14, 2020 16:52 ET (21:52 GMT)
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