Like toddlers refusing to put on their snowsuits, Canada’s Big 5 banks are falling further behind their global counterparts who are taking the first, halting steps toward aligning their financing policies with the demands of climate science.
Greenpeace Canada has called on banks to end the financing of new fossil fuel projects AND end new corporate level financing of companies expanding fossil fuel production and transportation. The European banks highlighted below have recently moved on project-level financing, while Canadian banks pull in the opposite direction.
ING: No $ for new oil and gas fields, or the pipelines and terminals that enable them
On March 14, the Dutch bank ING announced it would no longer finance ‘midstream’ projects, including pipelines and terminals, that would help unlock new oil and gas fields (it ended financing to new oil and gas projects in March 2022). The new policy also applies to its oil and gas trading operations, for which targets (aligned with the International Energy Agency’s Net Zero pathway) will be announced in 2024. This would make ING the first major bank to set targets for traded oil and gas.
HSBC: No $ for new oil and gas fields
The UK’s largest bank, HSBC, updated its Energy Policy to Support Net Zero Transition in December 2022 to clarify that it would “no longer provide new lending or capital markets finance for the specific purpose of projects pertaining to new oil and gas fields and related infrastructure when the primary use is in conjunction with new fields.”
There was a catch: HSBC’s Canadian arm was exempted from the new policy, as it is in the process of being sold to RBC. RBC – Canada’s largest bank – is a strong advocate of expanding oil and gas extraction, climate be damned.
NatWest: Phasing out $ for new oil and gas projects by 2026.
In February 2023, NatWest (previously called the Royal Bank of Scotland) announced it would not provide reserve based lending specifically for the purpose of financing oil and gas exploration, extraction and production for new customers. As of 2026, it would not renew, refinance or extend existing reserve based lending specifically for the purpose for financing oil and gas exploration, extraction and production.
Barclays: No $ for oil sands
In a narrower, but still significant, step Barclays (the UK’s second largest bank) announced in February 2023 that it would not provide financing to oil sands exploration and production companies, or for the construction of new oil sands-related infrastructure or pipelines.
There was an interesting twist in the details. Barclays’ annual report noted that their previous policy (adopted in 2020) was to only provided financing to oil sands exploration and production clients who have projects to reduce materially their overall emissions intensity, and a plan for the company as a whole to have lower emissions intensity than the level of the median global oil producer by the end of the decade. As a result of this policy, however, their lending exposure to oil sands exploration and production clients had reduced to zero at the end of 2022.
In short: none of the oil sands companies could convince the bean counters at Barclays that they were serious about their much-advertised ‘net zero’ claims.
Notably absent from all: No banks (thus far) are making serious moves on respecting, upholding and affirming Indigenous rights