European NGOs applaud RBS promise to staunch funding fossil fuels

Published by MAC on 2020-02-19
Source: BankTrack et al

Civil society groups welcome Royal Bank of Scotland preparing to exit
fossil fuels

Bank demands credible, ‘Paris proof’ transition plans from coal, oil and
gas clients by end 2021; commits to exit coal by 2030

BankTrack, Rainforest Action Network, Reclaim Finance and ShareAction
joint press release

18 February 2020

BankTrack, Rainforest Action Network, Reclaim Finance and ShareAction
welcome the announcement by Royal Bank of Scotland (RBS) of ambitious
new climate targets and a set of policy measures that, if fully
implemented, will see the bank move well ahead of its peers towards
taking up its responsibility in tackling the climate crisis. [1]

The measures, announced last Friday by Alison Rose, the bank’s recently
appointed CEO, include a significant commitment to ‘do what is necessary
to achieve alignment with the 2015 Paris climate Agreement’ and halve
the climate impact of its financing activities by 2030. This ambitious
goal is to be achieved by measures including a termination of all
lending and underwriting activities to companies with more than 15% of
activities related to coal, with a full phase out of finance to the coal
sector by 2030; termination of all lending for projects involving
exploration for new oil and gas reserves; and ‘progressively withdrawing
support’ for major oil and gas companies that ‘do not have a credible
transition plan in place that is in line with the Paris climate
Agreement by the end of 2021’.

Johan Frijns, director of BankTrack commented: “It is especially this
uncompromising stance towards its clients in the oil and gas sector that
makes RBS stand out positively from other banks that continue to finance
the fossil fuel industry. Whereas in the last few years a range of banks
have announced partial or even full phase-out plans for the coal sector,
no large bank has so far taken similar steps to exclude
‘non-transitioning’ major oil and gas clients from its portfolio. [2]

“RBS has come a long way since it actively advertised itself as ‘The Oil
and Gas Bank’ only fifteen years ago. It is now the first large bank to
demand from all its major clients in that same oil and gas sector that
they face up to the reality of the climate crisis and develop credible
Paris proof transition plans, and that they do so within two years or
lose support from the bank. This bold posture is exactly what we need
other banks to follow.” [3]

Daisy Termorshuizen, climate campaigner at BankTrack, added: “RBS is
taking significant steps towards meeting the three demands of the global
‘Fossil Banks, No Thanks’ campaign, supported by over 325 civil society
groups; acknowledge the responsibility of the fossil fuel industry for
causing the climate crisis, stop financing new fossil fuel projects and
come up with a credible phase-out plan. Even though RBS already reduced
its support for the coal, oil and gas industry over the years, this
policy change signifies an important commitment that other Fossil Banks
must follow”. [4]

The move from the Scotland-based bank is also important as the United
Kingdom readies itself to host the next Climate Summit in Glasgow in
November 2020. So far, the three largest UK banks Barclays, HSBC and
Standard Chartered continue to be enthusiastic supporters of the fossil
fuel industry, embarrassing the United Kingdom as host to the summit.
RBS is now showing these three banks a way more constructive way forward.

Yann Louvel, policy analyst at Reclaim Finance, said: "RBS becomes the
first big bank to adopt a 15% exclusion threshold for coal companies,
which is laudable, but the approach on coal from its French peer Crédit
Agricole still remains the most comprehensive so far as it excludes all
coal developers, phases out all exposure to any company active in the
coal sector by 2030 in EU/OECD countries and by 2040 elsewhere, and
calls on non-excluded companies to adopt by 2021 a detailed phase out
plan of their coal assets. The main breakthrough of this new policy from
RBS lies in its oil & gas approach with the exclusion of major oil and
gas companies without a credible transition plan in line with the 2015
Paris Agreement by the end of 2021. We will closely track the
implementation of this policy and call on other financiers such as
Barclays and BNP Paribas to follow suit and stop financing climate
destruction."

Patrick McCully, Climate and Energy Program Director at Rainforest
Action Network, said: “While this policy still has some apparent
loopholes on coal and while as ever the proof of its value will be in
its implementation, RBS has now positioned itself as a global leader on
climate among big banks. Its requirement that major oil and gas clients
adopt Paris-aligned transition plans and its goal to at least halve the
emissions it finances by 2030 are especially significant. It is now time
for RBS’s UK peers, and the global mega-banks like JPMorgan Chase and
Wells Fargo which bear most responsibility for bankrolling the climate
crisis, to follow RBS’s lead and announce their intention to phase out
fossil-fuel financing on a Paris-aligned timetable.”

Jeanne Martin, Campaign Manager at ShareAction, said: “We applaud RBS
for raising the bar of ambition for banks by committing to stop lending
to major energy companies that do not have credible transition plans
aligned with the Paris climate agreement by 2021. RBS’s new commitment
is in line with what ShareAction’s climate change resolution asks of
Barclays, Europe’s largest fossil fuel financer. If RBS, which used to
market itself as “the oil and gas bank” can do it, so can Barclays.”

Johan Frijns of BankTrack added: ”While the bank has not yet provided
details on how exactly it will measure the climate impact of its
financing activities, or how it will assess the quality of transition
plans of major oil and gas clients, and with the devil usually hiding in
these details, we all wish to salute Alison Rose for her courage and
sector wide leadership on this matter.”

Notes for editors:

[1] See RBS: Climate, Our Approach to Climate Change and Oil & Gas,
Mining & Metals and Power Generation.

[2] For an overview of fossil fuel related climate commitments of major
banks see Banking on Climate Change (2019). A new edition of this report
will be published in March 2020.

[3] For an historical perspective, see The Oil & Gas Bank, RBS & the
financing of climate change (2007).

[4] See www.fossilbanks.org.

Contact:

Johan Frijns, director BankTrack, johan@banktrack.org, tel 31 24 324 9220
Yann Louvel, Policy analyst, Reclaim Finance, yann@reclaimfinance.org,
+33 688 907 868
Jeanne Martin, Campaign Manager at ShareAction,
jeanne.martin@shareaction.org, +44 2071832359
Patrick McCully, Climate and Energy Program Director at Rainforest
Action Network, patrick@ran.org, +1 510 213 1441

* BankTrack is the global tracking, campaigning and NGO support
organisation targeting the operations and investments of
international commercial banks.
* Rainforest Action Network preserves forests, protects the climate
and upholds human rights by challenging corporate power and systemic
injustice through frontline partnerships and strategic campaigns.
* Reclaim Finance, based in France, is putting pressure on financial
players to accelerate the exit from fossil fuels and ensure a
sustainable world for all.
* ShareAction's vision is a world where ordinary savers and
institutional investors work together to ensure our communities and
environment are safe and sustainable for all.