A group of shareholders including large UK public pension funds has filed a shareholder resolution calling on Barclays to set out a plan to phase out financing of fossil fuel companies and certain utility companies.
Brunel Pension Partnership, LGPS Central, and Merseyside Pension Fund are among 11 institutional investors that filed the resolution alongside more than 100 individual shareholders. Swedish pensions and insurance group Folksam is also participating.
The resolution is the first climate change resolution at a bank listed in Europe. It asks Barclays to set and disclose targets to gradually stop providing financial services to companies in the energy sector, and to gas and electric utilities that are not aligned with the goals of the 2015 Paris Agreement on climate change.
The bank is also being asked to report annually on progress against the targets.
“As systemically important actors, large global banks can influence whether or not the Paris goals are met,” the investors wrote in the resolution’s supporting text.
Laura Chappell, CEO of Brunel Pension Partnership, said: “We believe that it is crucial for investors to carry out climate change risk assessments across the whole financial chain.
“As banks are the biggest lenders, they are a key component of this. The lending practices of many banks pose a serious threat to the goals to the Paris agreement.”
Natasha Landell-Mills, head of stewardship at asset manager Sarasin & Partners, said Barclays was among “the most prolific bank financiers globally” of fossil fuel financing.
Citing research from non-profit groups, ShareAction, which is co-ordinating the investor group, said Barclays was the world’s sixth largest backer of fossil fuels, and the biggest of any European bank.
Jeanne Martin, campaign manager at ShareAction, said: “For too long, minor policy improvements have provided cover for the banking sector, while failing to halt fossil fuel financing.
“If Barclays supports the Paris Agreement, it will support this resolution.”
The shareholder resolution will be voted on at Barclays’ annual general meeting in May.
A Barclays spokesperson said: “We are working to help tackle climate change, and we meet with Share Action and other shareholders regularly to update them on our progress.”
Barclays considers its fossil fuel financing activity should be compared with that of its US peers rather than with other European banks given its presence in the US market.
In its January 2019 climate change policy statement Barclays said that in most scenarios, oil and gas were expected to continue to be the main sources of energy “for decades to come”, and that reliance on gas was expected to increase over the same time period.
“Accordingly […] we will place restrictions on our exposure in some carbon intensive sectors, such as thermal coal,” it said. “We will however support oil and gas clients that operate in an environmentally and socially responsible way, in order to ensure that the world’s energy needs are met.”
Barclays is a founding member of the Principles for Responsible Banking, an initiative launched by a United Nations unit in September.