HSBC warns only companies with robust sustainability strategy will get finance as banks take steps to tackle climate change

Name: Central under water in 80 years? Hong Kong’s coming climate crisis
Uploaded: 2022-10-05T12:00:11.000Z
Duration: 9 min 22 s
Description: Central under water in 80 years? Hong Kong’s coming climate crisis

Markets will only provide finance to companies that have a robust and clear sustainability strategy, says Jonathan Drew, HSBC’s regional sustainability head

HSBC and many other banks have outlined plans to reduce financed emissions in their portfolios to net zero by 2050 or earlier

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Banks such as HSBC have rolled out initiatives to reduce financing to carbon-intensive sectors as part of efforts to slash their carbon dioxide emissions and reach net zero within three decades. Photo: Bloomberg

Martin Choi

Published: 8:00pm, 5 Oct 2022

HSBC warned that companies will need a “robust and clear sustainability” strategy or they will find it increasingly difficult to get financing, a senior executive said on Wednesday.

“You need to be [green], otherwise you’re going to find it increasingly difficult to obtain capital from us and from the markets generally,” said Jonathan Drew, head of global banking sustainability in the Asia-Pacific at HSBC, speaking at the “Hong Kong’s race towards a net-zero future” panel discussion at the Rethink HK conference.

“[Companies] must have a good, robust, clear sustainability strategy and story, and communicate it clearly,” he added.

Hong Kong’s government has set a goal to achieve carbon neutrality by 2050, part of global efforts to reduce emissions and tackle climate change. Companies and banks are beginning to feel the pressure to introduce initiatives that align with these targets.

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Central under water in 80 years? Hong Kong’s coming climate crisis

HSBC, the largest of the city’s three currency-issuing banks, has committed to reducing financed emissions in its portfolio to net zero by 2050 or earlier, along with other banks across the globe such as London-based Standard Chartered and Singapore-based DBS. This means that banks will be keeping an eye on the emissions generated from the projects or companies that they finance or lend capital to.

Banks have rolled out initiatives to reduce financing to carbon-intensive sectors, such as oil and gas, as part of efforts to slash their carbon dioxide emissions and reach net zero within three decades.

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