Institutional investors with assets worth $2.47trn (€2trn) are pushing Credit Suisse to step up efforts to cut financing coal while the lender is under pressure for its role in the Greensill and Archegos crises.
In a statement ahead of the bank’s annual general meeting, held today, ShareAction and seven institutional investors demanded Credit Suisse to set a firm date to phase out from coal, citing the Intergovernmental Panel on Climate Change (IPCC), which recommends 2030 for the OECD and 2040 at the latest for the rest of the world.
The group of investors, coordinated by ShareAction, includes Amundi, BMO Global Asset Management, Actiam and Folksam, according to reports. Ethos Foundation also joined the group.
Environmental organization Rainforest Action Network listed Credit Suisse as the third largest financier of coal power and the largest financier of coal mining for the period 2016-2020 in Europe, the statement said.
Therefore, the bank should curb corporate financing, underwriting and advisory services to companies developing new coalmines and coal-fired power plants, the statement added.
Credit Suisse should also disclose further information on its view of companies’ green transition strategies, it said.
The investors pointed out that the lender committed last year to stop financing or provide underwriting services to companies making over 25% of their revenues through coal, unless companies design a “credible transition strategy to diversify away from thermal coal.”
Under intense scrutiny
Credit Suisse has been under intense scrutiny from investors after recording losses following the collapse of hedge fund Archegos Capital and Greensill Capital.
As a result, the bank’s risk committee head, Andreas Gottschling, did not stand for re-election at the AGM. The shareholders elected a new chair of the board of directors, António Horta-Osório, to replace Urs Rohner.
Clare Brady and Blythe Masters have been elected as new members of the board of directors.
Ethos Foundation – which is composed of more than 220 institutional investorshad – recommended shareholders vote against re-electing Rohner on the back of shortfalls relating to the governance of the bank.
Credit Suisse had previously moved forward to remove the chief executive officer of its investment bank division, Brian Chin, and chief risk and compliance officer Lara Warner.
Ethos had also directed a series of questions to the board of directors prior to the AGM, one specifically on plans to review the composition of the risk committee after today’s meeting.
It had asked Credit Suisse whether it would also examine the responsibility of the board of directors in connection with the Greensill and Archegos cases and to guarantee that the details of the result of the investigations into the cases are made public.
The bank had launched two investigations to shed light on what occurred with Greensill and Archegos Capital.