Credit Agricole, HSBC, Munich Re, Standard Chartered and Swiss Re have joined with The Climate Group to launch a new code, dubbed “The Climate Principles,” to guide best practices for financial institutions to deal with climate change.
If the name sounds familiar, that’s because “The Carbon Principles” is the name Bank of America, J.P. Morgan Chase, Citigroup, Morgan Stanley, Credit Suisse, and Wells Fargo use for the principles launched in February to provide a consistent approach for banks and their U.S. power clients to evaluate and address carbon risks in the financing of electric power projects – they’ve been touted as principles that make it tougher for investor-owned utilities to get financing for coal-fired power plants.
Ethical Corporation made an interesting point in its coverage of the new group. Even though around 20 financial institutions helped to develop the principles, just five felt able to go public with their commitment to the framework, which might indicate that banks are wary about making environmental promises during the current global market turmoil.
Francis Sullivan, from HSBC and Chair of The Climate Principles said, “Signatories will incorporate carbon and climate risk into their research activities and investment decisions, engage with clients to understand climate risks and opportunities and develop products and services that support them in managing those risks and exploiting those opportunities.”
(This article has been corrected to indicate the correct name of the U.S. banking group, “The Carbon Principles.” The new group does not have the same name, as indicated by the earlier version of the article.)