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HSBC AM to ‘walk away’ from heavy emitters in coal phase-out

HSBC AM to ‘walk away’ from heavy emitters in coal phase-out.
Hong Kong, Hong Kong - February 16, 2016: HSBC headquarter building with illuminated logo shown at night.

HSBC Asset Management has announced it will phase coal-fired power and thermal coal mining out of its listed holdings by 2030 in the EU and OECD and by 2040 globally.

In active portfolios this means phasing out listed securities of issuers with more than 2.5% revenue exposure to these activities.

The firm also stated it will take action against companies not showing credible plans to phase out coal.

As part of its engagement with its active and passive holdings, listed issuers with more than 10% revenue exposure to thermal coal and those that do not provide Task Force on Climate-related Financial Disclosures or equivalent reporting, will face an HSBC AM vote against the re-election of their chairs.

Nicolas Moreau, CEO of HSBC Asset Management, said: “We believe in working in partnership with our clients to transition away from thermal coal, while supporting a just transition. But we are clear that we will need to walk away from companies that don’t or won’t take active credible steps to reduce emissions.”

The move to phase out coal is part of HSBC AM’s commitment to the Net Zero Asset Managers initiative and the wider group’s ambition to align its financed emissions to net zero by 2050.

Further elements of the plan include limits on actively-managed portfolios’ involvement in initial public offerings of companies with coal exposure.

This story first appeared on our sister publication, ESG Clarity.

Part of the Mark Allen Group.